Gold sticks to 9-mth high amid recession concerns, copper advances

By Ambar Warrick

Investing.com -- Gold prices steadied near a nine-month high on Wednesday as fears of a looming recession kept safe haven demand elevated, while copper prices rose on expectations that a recovery in Chinese demand will help offset slowing consumption in other countries.

Bullion prices advanced past a drop in stock markets, as safe haven demand for the metal outpaced that for the dollar amid increased expectations that the Federal Reserve will slow its pace of interest rate hikes in the coming months.

Spot gold was flat at $1,937.64 an ounce, while gold futures rose 0.2% to $1,938.35 an ounce. The yellow metal’s spot price narrowed the gap with the futures contract, ahead of the latter’s expiry in February.

Gold has been on a tear since mid-December amid growing expectations of smaller U.S. interest rate hikes, as economic growth and inflation cool in the country. Prices are also trading about $140 below a record high hit in 2020.

Recent losses in Wall Street, following a raft of weak corporate earnings, also fed into fears of slowing economic growth, which in turn boosted demand for gold.

Bullion prices have also vastly outperformed those of other precious metals so far this year. Gold is up about 6%, while silver and platinum are down more than 1% each.

The yellow metal’s rally was triggered largely by data indicating that U.S. inflation eased more than expected over the past few months, which is likely to invite smaller rate hikes by the Fed. Markets are broadly pricing in a 25 basis point hike by the Fed in February, and a potential pause in the central bank’s hiking cycle in the coming months.

Focus this week is on U.S. fourth-quarter GDP data to gauge how much growth slowed towards the end of 2022, especially as the effects of sharp interest rate hikes and relatively higher inflation began to be felt.

Among industrial metals, copper prices hovered at an over seven-month high on expectations of a sharp recovery in Chinese demand this year, as the country reemerges from three years of COVID-19 restrictions.

High-grade copper futures rose 0.1% to $4.2672 a pound, trading near their highest level since mid-June.

Still, markets remain uncertain over the timing of a Chinese economic recovery, given that the country is facing its worst yet COVID-19 outbreak.

Begin trading today! Create an account by completing our form

Privacy Notice

At One Financial Markets we are committed to safeguarding your privacy.

Please see our Privacy Policy for details about what information is collected from you and why it is collected. We do not sell your information or use it other than as described in the Policy.

Please note that it is in our legitimate business interest to send you certain marketing emails from time to time. However, if you would prefer not to receive these you can opt-out by ticking the box below.

Alternatively, you can use the unsubscribe link at the bottom of the Demo account confirmation email or any subsequent emails we send.

By completing the form and downloading the platform you agree with the use of your personal information as detailed in the Policy.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 82.7% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Back to top

Office network
  • London Office
    One Financial Markets 

    1 Finsbury Market
    London
    EC2A 2BN
    United Kingdom


    T:  + 44 ( 0 ) 203 857 2000
    E:  info@ofmarkets.com
  • Dubai Office
    One Financial Markets 
    OT19-39 Central Park Tower
    Dubai International Finance Centre
    Dubai
    United Arab Emirates
     
    T: + 971 44 22 888
    E:  info@ofmarkets.com
     

One Financial Markets is the trading name of Axi Financial Services (UK) Ltd, a company registered in England with company number 6050593. Axi Financial Services Ltd is authorised and regulated by the Financial Conduct Authority in the UK (under firm reference number 466201) and the Financial Sector Conduct Authority in South Africa (with FSP number 45784).

The information on this site is not directed at residents of the United States, Belgium, Poland or any particular country outside the UK and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

www.onefinancialmarkets.com is owned and operated by Axi Financial Services (UK) Ltd.

Award winning broker
We have been presented with a number of awards that recognise the quality of our service and dedication to our clients :

Best FSA Regulated Broker
Saudi Money Expo

Best Education Product
Saudi Money Expo

Best Broker - Online Trading
IAIR Awards

Best Institutional Broker
Saudi Money Expo

Best FX Services Broker
CN Forex

Top International
FX Broker 2015

Saudi Money Expo

Broker of the Year
Online Trading – Middle East

IAIR Awards

Best Forex
Customer Service 2018

JFEX Awards

We accept the following payment methods: