Investing.com Gold Prices Rise Slightly

Gold prices rose slightly on Tuesday, steadying after a sharp drop in the prior session as anticipation of a Federal Reserve meeting and more cues on interest rates kept traders biased towards the dollar.

Industrial Metals and Copper Prices

Among industrial metals, copper prices sank further amid persistent concerns over slowing Chinese demand. Increased production from a joint deal between BHP and Lundin Mining (OTC:LUNMF) to take over Filo Corp and expand its South American copper projects also weighs on copper.

Gold Market Analysis

Gold was pressured by an overnight increase in the dollar, leading to long positioning ahead of Wednesday’s Fed rate decision. Spot gold rose 0.1% to $2,387.98 an ounce, while gold futures for December rose 0.2% to $2,431.35 an ounce by 00:25 ET (04:25 GMT).

Fed Meeting Anticipation

Gold steadied from sharp swings in recent sessions, hitting record highs earlier in the month due to safe haven demand. However, focus has shifted to U.S. interest rates. Lower rates typically benefit precious metal prices, but signals of contrary movements pose risks to the sector.

Traders remained biased towards the dollar ahead of the Fed’s two-day meeting starting later on Tuesday. The central bank is expected to keep rates unchanged, but signals regarding future rate cuts will be closely scrutinized.

Markets are pricing in a 25 basis point cut in September, although doubts remain regarding further cuts.

Other Precious Metals

Other precious metals saw increases but were still nursing recent steep losses. Platinum futures rose 0.3% to $962.55 an ounce, and silver futures rose 0.7% to $28.055 an ounce.

Copper’s Declining Prices

Benchmark copper futures on the London Metal Exchange fell 0.5% to $8,980.0 a tonne, while one-month copper futures decreased by 0.9% to $4.0585 a pound, both nearing four-month lows. Persistent concerns over slowing Chinese demand and anticipated increased supply weighed heavily on copper prices.

BHP Group Ltd (ASX:BHP), the world’s largest miner, and Canada’s Lundin Mining Corporation (TSX:LUN) announced a $4 billion joint deal to acquire Filo Mining Corp (TSX:FIL), aimed at expanding their South American copper projects and boosting production.