Gold prices remained stable on Wednesday as investors awaited crucial U.S. inflation data that could influence the Federal Reserve‘s interest rate trajectory amid ongoing trade tensions and concerns about an economic slowdown. Attention was also directed towards a possible ceasefire agreement in Ukraine. Gold rates in the UAE rose today. The price of 24-carat gold increased by AED 0.50, settling at AED 351.25. Likewise, 22-carat gold saw a rise of AED 0.50, reaching AED 326.75. The price of 21-carat gold went up by AED 0.25 to AED 313.25, while 18-carat gold also increased by AED 0.25, now priced at AED 268.50.
Spot gold was unchanged at $2,916.69 per ounce as of 03:00 GMT, while U.S. gold futures edged up 0.1 percent to $2,922.30. Investors are keenly anticipating the U.S. Consumer Price Index (CPI) data set to be released later in the day, which will provide insights into the Fed’s interest rate policy for the remainder of the year.
If escalating price pressures compel the Fed to maintain higher interest rates, gold may lose its appeal as it is considered a non-yielding asset. U.S. President Donald Trump’s tariffs are largely expected to exacerbate inflation and economic uncertainty, which has driven gold to achieve a record high of $2,956.15 on February 24.
Ceasefire proposal from Kyiv
Trump defended his tariff initiatives on Tuesday during a meeting with the CEOs of America’s largest companies. Many of these companies have seen their market values decline in recent days, as recession and inflation anxieties have dampened consumer and investor sentiment. On Tuesday afternoon, Trump reversed his earlier commitment to double tariffs on steel and aluminum from Canada to 50 percent, shortly after announcing the increased tariffs.
Meanwhile, the U.S. has decided to resume military aid and intelligence sharing with Ukraine after Kyiv indicated its readiness to accept a U.S. proposal for a 30-day ceasefire in its conflict with Russia. Spot silver dipped 0.5 percent to $32.76 per ounce, platinum increased 0.4 percent to $978.60, and palladium fell 0.6 percent to $940.53.
Gold prices rally on trade war concerns
Gold prices experienced an uptick on Tuesday, driven by the trade war which heightened demand for the yellow metal due to its safe-haven status. Traders ignored positive U.S. jobs data and continued to invest in bullion. XAU/USD is currently trading at $2,917, reflecting an increase of over 1 percent.
Recent sentiment has improved as Canada and the U.S. have de-escalated the potential for imposing tariffs. Concerns about a slowdown in the U.S. economy are putting downward pressure on U.S. Treasury yields and the dollar, which benefits bullion prices.
In related news, Trump’s trade tariffs on aluminum and steel imports are set to take effect on Wednesday. The U.S. Bureau of Labor Statistics (BLS) reported an increase in job openings in February.
Breaking news from Saudi Arabia indicated that Ukraine is prepared to accept a ceasefire proposal, as revealed by U.S. Secretary of State Marco Rubio. Ukraine’s President Volodymyr Zelenskyy stated, “It is up to the U.S. now to convince Russia to agree on a ceasefire.” This development could pose a challenge for gold prices, which typically rise due to heightened geopolitical tensions and recession fears.
