Gold prices remained steady during Tuesday’s Asian session, pausing after a three-day rally, as investors weighed rising expectations of a Federal Reserve interest rate cut and ongoing global trade disruptions.
Spot gold hovered near recent highs at $3,372.25 per ounce, showing little movement, while December gold futures held flat around $3,425.02/oz as of 01:00 ET (05:00 GMT).
Gold Benefits from Rate Cut Optimism, Trade Tensions
The precious metal extended gains over the past three sessions, with a sharp 2% surge on Friday, triggered by disappointing U.S. labor market data.
The July nonfarm payrolls report showed only 73,000 jobs added, far below market estimates. Additionally, earlier figures for May and June were revised downward, while the unemployment rate ticked up to 4.2%, amplifying concerns about a cooling U.S. economy.
In response, markets have ramped up expectations for Fed easing, now pricing in a 92% chance of a rate reduction in September, according to data from the CME FedWatch Tool.
With interest rates expected to drop, the appeal of non-yielding assets like gold typically increases, as the opportunity cost of holding them declines.
Although the U.S. dollar regained some ground following two sessions of sharp losses, gold remained attractive for international buyers due to the relatively weaker greenback.
Concerns over trade policies also bolstered bullion’s safe-haven demand. U.S. Trade Representative Jamieson Greer indicated that the broad tariffs targeting imports from nearly 70 countries—first introduced by President Trump—are unlikely to be rolled back, stoking fears of inflationary pressures.
Further unsettling markets were renewed tariff threats on India, sparked by its ongoing oil trade with Russia. These developments added to global economic uncertainty and supported safe-haven flows into gold.
Other Metals Mixed; Platinum Falls, Silver Inches Higher
In other metals trading, platinum futures slipped 0.5% to $1,335.65/oz, while silver futures rose slightly by 0.2% to $37.415/oz.
On the industrial side, benchmark copper futures on the London Metal Exchange climbed 0.3%, reaching $9,720.65 per ton. However, U.S. copper futures stayed mostly flat at $4.454 per pound.
Notably, U.S. copper prices plunged 20% last week, after Trump’s decision to exclude refined copper from a proposed 50% import tariff, sending shockwaves through the market.
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