Gold prices declined on Wednesday as investors awaited the release of key U.S. inflation data later in the day, which could provide additional insight into the Federal Reserve‘s September policy meeting decision.
In the UAE, gold prices lost AED1.5 with 24-carat gold inching down to AED298 while 22-carat gold declined to AED276. Meanwhile, 21-carat gold reached AED267.25 and 18-carat gold reached AED229.
Globally, spot gold lost 0.08 percent to $2,461.93, as of 5:08 GMT. Meanwhile, U.S. gold futures fell 0.26 percent to $2,501.35.
Inflation to rise in July
Gold prices dipped as investors awaited the July U.S. consumer price index data due at 12:30 GMT. The data is expected to reveal a month-on-month inflation growth to 0.2 percent and a decline in annual core inflation to 3.2 percent. Markets also await the release of U.S. retail sales data on Thursday.
Data on Tuesday revealed that U.S. producer prices increased less than expected in July, solidifying the market’s view that inflation is cooling, which will prompt the Fed to cut rates soon.
Atlanta Fed President Raphael Bostic said he wants to see some more data before he’s ready to support cutting interest rates. Traders are pricing in a 54 percent chance of a 50-basis-point U.S. rate cut in September, according to the CME FedWatch Tool.
Gold prices have hovered near their record high as geopolitical tensions in the Middle East escalated and hopes of a lower interest rate environment bolstered demand for non-yielding assets.
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Other precious metals
In line with the decline in gold prices, the precious metals market dipped with spot silver declining by 0.37 percent to $27.74. Meanwhile, palladium lost 0.03 percent to $938.33 and platinum dipped 0.53 percent to $931.19. However, copper remained flat at $4.04.
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