Gold prices increased on Friday and were on track for a positive week due to the belief that the Federal Reserve was nearing the end of its rate hike cycle, media reports. Copper prices also rose as China, a major importer, announced more measures to boost consumption in the automobile and consumer electronics sectors.
Despite some profit-taking in gold due to the dollar's rebound, bullion prices were stable in the high $1,900s and set for a third straight positive week.
Spot gold and gold futures both rose 0.1%, with a projected 0.5% to 1% increase for the week.
Copper futures increased 0.7% to $3.8555 a pound due to the potential for increased demand in the automobile and electronics sectors.
Meanwhile, metal markets anticipate the Federal Reserve's upcoming meeting and expect the bank to hike interest rates by 25 basis points. However, markets predict it will be the last hike for the year, with rates remaining at 5.5% until the bank begins loosening policy in 2024. The potential pause in the Fed's rate hike cycle is seen as a positive sign for metal prices after being impacted by higher opportunity costs with surging yields over the past year.
Gold, in particular, has seen a substantial recovery in the past month due to expectations of a potential Fed pause in July. However, officials have not yet given clear signals on when they plan to pause their rate hike cycle.
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