Gold prices edged higher on Wednesday, buoyed by a slight retreat in the IN. and Treas, as investors digested fresh inflation data and awaited direction on U.S. President Donald Trump’s trade policy.
At 0550 GMT, spot gold rose 0.5% to $3,337.29 per ounce, while U.S. gold futures gained 0.2% to $3,343.90. The uptick was driven by a softer dollar index, which eased from a one-month high, and a pullback in 10-year U.S. Treasury yields from recent multi-week peaks.
Gold Gains on Safe-Haven Appeal
Brian Lan, Managing Director at GoldSilver Central, Singapore, explained:
“Many countries are still negotiating with the U.S. on the tariffs. There are still a lot of uncertainties in the market and many are looking for safe havens.”
Trump’s latest remarks added to market tension. Over the weekend, he threatened to impose 30% tariffs on imports from Mexico and the European Union starting August 1, though he has since said he’s open to further negotiations.
This backdrop of trade-related volatility is pushing investors toward safe-haven assets like gold, particularly as inflation concerns begin to mount.
Gold Prices in Pakistan Fall as US Inflation Data Tempers Rate Cut Hopes
Inflation and Fed Policy Outlook
New data released Tuesday showed that U.S. consumer prices rose in June by the most in five months, suggesting tariffs are starting to pressure consumer goods and could influence monetary policy decisions.
President Trump responded to the data by calling for interest rate cuts, despite inflation ticking higher. Meanwhile, Dallas Fed President Lorie Logan pushed back on immediate rate changes, noting:
“The Fed will probably need to leave rates where they are for a while longer to ensure inflation stays low, especially amid pressure from tariffs.”
Gold typically performs well in a low-interest-rate environment, where the opportunity cost of holding non-yielding assets is reduced.
Markets are now closely watching the U.S. Producer Price Index (PPI) due at 1230 GMT, which could offer additional clues on inflation trends and shape expectations ahead of the Fed’s September policy meeting.
Other Precious Metals Also Firm
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Spot silver: +0.3% to $37.83/oz
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Platinum: +0.3% to $1,375.63/oz
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Palladium: +0.2% to $1,208.91/oz
The broader precious metals complex is finding support as investors seek portfolio hedges amid geopolitical and economic uncertainty.