Gold Prices Hold Steady

Gold prices remained stable during Asian trade on Tuesday, hovering near 11-day lows as traders awaited clearer signals regarding U.S. politics and monetary policy, especially with a Federal Reserve meeting approaching next week.

Copper Prices Decline Amid Economic Woes

Copper prices continued to decline on Tuesday, exacerbating losses from recent sessions due to increasing economic uncertainty in China, the top copper importer.

Spot gold rose 0.1% to $2,398.38 an ounce, while gold futures increased 0.2% to $2,399.40 an ounce by 00:33 ET (04:33 GMT).

Gold’s Decline from Record Highs

The yellow metal faced a significant decline from record highs over the past week, primarily due to political uncertainty in the U.S. Earlier in July, spot prices had peaked at around $2,470 an ounce before falling sharply. Speculation surrounding a possible Trump presidency and some resilience in the dollar also exerted downward pressure on gold prices.

Political dynamics shifted when President Joe Biden withdrew his reelection bid and endorsed Vice President Kamala Harris, who is expected to gain enough Democratic delegates for the presidential nomination, though formal nomination is still pending. Polls from CBS and HarrisX indicated Trump leading ahead of both Biden and Harris, although the polls did not yet account for Biden’s withdrawal.

While the political uncertainty spurred some safe haven flows into gold, the strength of the dollar limited these inflows. However, gold has still seen strong gains this year, fueled by optimism that the Federal Reserve might begin cutting interest rates in September, although the central bank is expected to keep rates steady at next week’s meeting.

Other Precious Metals Retreat

Other precious metals experienced a decline on Tuesday, with platinum futures down 0.1% to $959.65 an ounce, and silver futures falling 0.5% to $29.188 an ounce.

Copper Prices Struggle Due to China Concerns

Among industrial metals, benchmark copper futures on the London Metal Exchange rose 0.2% to $9,234.50 a tonne, while one-month copper futures fell by 0.3% to $4.1873 a pound.

Both contracts hit over 3-½ month lows as negative sentiment regarding China further impacted prices. Recent data indicated slower economic growth in China during the second quarter, and an unexpected interest rate cut on Monday failed to boost market confidence. Additionally, the Chinese Communist Party’s Third Plenary Session did not provide significant updates on new economic support plans.

Concerns regarding tighter U.S. monetary policy, particularly if Trump were to return to office, also kept traders cautious about assets exposed to the Chinese economy.