Gold prices edged lower on Friday, paring back some of their weekly gains as comments from Federal Reserve officials dampened expectations for imminent interest rate cuts.
Earlier in the week, gold surged to nearly $2,400 an ounce following softer U.S. economic data. However, by Thursday and Friday, the momentum had waned. Spot gold settled at $2,377.40 an ounce, while June gold futures dipped to $2,381.10 an ounce by 00:19 ET (04:19 GMT).
Gold Retreats as Fed Officials Downplay Rate Cuts
The decline in gold prices began on Thursday after multiple Federal Reserve officials warned against anticipating immediate rate reductions. They emphasized the need for more substantial evidence that inflation was decreasing, beyond April’s marginally lower inflation reading.
This cautious stance led traders to scale back expectations for a rate cut in September. Consequently, both the dollar and U.S. Treasury yields rebounded from earlier losses this week.
Despite the pullback, gold remained on track for a 0.7% weekly gain, buoyed by weaker-than-expected consumer price index readings. The metal also remained close to a record high of over $2,430 an ounce, though reaching this level in the near term appeared unlikely.
Other Precious Metals See Weekly Gains Despite Friday’s Retreat
Other precious metals also declined on Friday but posted strong weekly gains. Platinum futures fell 0.2%, yet were up 6.2% for the week. Similarly, silver futures dropped 0.4% but were up 4.5% for the week.
Copper Mixed Amid Mixed Economic Signals from China
In the industrial metals market, one-month copper futures fell from two-year highs, reflecting mixed economic data. However, three-month copper futures rose, ending the week on a high note due to expectations of tighter supplies and a potential demand recovery.
On the London Metal Exchange, three-month copper futures climbed 0.6% to $10,445.0 a ton, while one-month copper futures increased 0.3% to $4.8935 a pound.
Data from China on Friday showed a mixed economic picture. Industrial production exceeded expectations, but retail sales growth slowed, and house prices fell at a faster rate. Growth in fixed asset investment also decelerated.
These mixed signals presented an unclear outlook for China, the world’s largest copper importer, as the country implemented more stimulus measures to boost growth. Despite this, three-month copper futures were up nearly 4% for the week, reaching two-year highs.