June 7 2024: Gold prices increased in Asian trading on Friday, nearing significant highs as expectations of interest rate cuts by the Federal Reserve grew in anticipation of key nonfarm payrolls data due later in the day. The yellow metal was set for weekly gains as a series of weak U.S. economic readings bolstered the belief that the Fed will begin cutting rates in September, pushing the dollar to two-month lows.
Interest Rate Cuts Boost Metal Markets
Rate cuts by the Bank of Canada and the European Central Bank further fueled optimism for looser monetary policy, benefiting metal markets. Spot gold rose 0.5% to $2,386.55 an ounce, while gold futures for August delivery increased by 0.6% to $2,405.40 an ounce by 00:59 ET (04:59 GMT).
Gold Heads for Weekly Gains, Nonfarm Payrolls Data Awaited
Spot gold was on track to gain approximately 2.6% this week, driven by soft U.S. economic data, particularly concerning the labor market, which heightened expectations of rate cuts. This data came just days before the key nonfarm payrolls report, expected later on Friday, which will provide more definitive insights into the labor sector and interest rates.
The payrolls data precedes a Federal Reserve meeting next week, where the central bank is widely expected to maintain current interest rates. However, any signals regarding future monetary policy will be closely watched, especially following recent cooling U.S. economic indicators.
Other Precious Metals’ Performance
Other precious metals also rose on Friday but displayed mixed weekly performance. Platinum futures increased by 0.3% to $1,014.40 an ounce, while silver futures rose 0.8% to $31.622 an ounce. For the week, platinum was down 2.6%, while silver was up nearly 4%.
Copper Prices Remain Muted Despite Positive China Data
Among industrial metals, copper prices remained subdued on Friday, nursing a decline from record highs over the past two weeks. However, positive Chinese import data provided some support for the red metal. Benchmark copper futures on the London Metal Exchange fell 0.3% to $10,116.50 a tonne, while one-month copper futures declined 0.4% to $4.6532 a pound.
Data from China showed that although overall imports grew much less than expected in May, copper imports rose 2.6% year-on-year. Additionally, China’s exports grew more than expected, reflecting strong industrial output and overseas demand.
