Gold prices rise, keep record highs in sight as inflation test approaches

Investing.com-- Gold prices rose in Asian trade on Thursday, staying close to record highs as a rebound in the dollar cooled ahead of key inflation data that is likely to factor into the outlook for interest rate cuts.

Some safe haven demand also buoyed bullion prices, especially after some underwhelming earnings from market darling NVIDIA Corporation (NASDAQ:NVDA) rattled global equity markets.

Spot gold rose 0.4% to $2,515.76 an ounce, while gold futures expiring in December rose 0.4% to $2,515.91 an ounce by 00:50 ET (04:50 GMT). 

Gold remains close to record highs before inflation, GDP

Spot prices were less than $20 away from a record high of $2,532.05 an ounce hit last week. 

While the yellow metal had struggled to make new highs since, it still remained relatively well-bid amid growing conviction that the Federal Reserve will cut interest rates in September- a scenario that benefits gold. A softer dollar also aided metal markets, although the greenback rebounded sharply from 13-month lows this week.

Safe haven demand also factored into gold’s resilience, as tensions in the Middle East showed little signs of abating, while the suspension of oil production in Libya added a new layer of uncertainty.

The safe haven trade was furthered by a drop in shares of market darling Nvidia, which sparked losses across broader equity markets on fears that the artificial intelligence trade was cooling.

But focus in the coming days was squarely on more U.S. economic cues. A revised reading on gross domestic product data is due later on Thursday, after a preliminary reading released last month showed the economy remained strong in the second quarter.

More closely watched will be PCE price index data on Friday. The print is the Fed’s preferred inflation gauge and is likely to factor into expectations for rate cuts.

Markets are split between a 25 or 50 basis point cut in September, according to CME Fedwatch.

The prospect of lower rates dented the dollar and buoyed broader metal markets, although they mostly lagged gold. Platinum futures rose 0.5% to $942.50 an ounce, while silver futures rose 0.8% to $29.858 an ounce. 

Copper steadies, China sentiment remains weak 

Among industrial metals, copper prices rose slightly on Thursday, although a rebound rally seen in recent weeks appeared to have run dry. 

Benchmark copper futures on the London Metal Exchange rose 0.3% to $9,268.50 a ton, while one-month copper futures rose 0.1% to $4.2190 a pound. 

But copper’s recent rebound appeared to be running out of steam, especially as sentiment towards top importer China remained constrained by concerns over a renewed trade war with the West. 

Still, the prospect of improving economic growth, amid lower interest rates, spurred some bets that global copper demand will improve.