Gold prices firmed on Wednesday as investors remained cautious amid ongoing uncertainty over the U.S.-China trade truce ahead of key inflation data that could influence the Federal Reserve’s next policy decisions.
Spot gold rose 0.7% to $3,344.93 an ounce as of 0808 GMT, while U.S. gold futures gained 0.7% to $3,366.40.
On Tuesday, U.S. and Chinese officials announced an agreement on a framework to revive their trade truce and ease China’s export restrictions on rare earth metals. Despite the progress, talks showed little indication of a lasting resolution to the broader trade disagreements between the two nations.
Markets remain aware that negotiating a comprehensive trade deal between these economic giants is complex and uncertain, according to Han Tan, chief market analyst at Exinity Group. “Gold should remain supported as long as global trade tensions either escalate or persist at elevated levels,” he said.
The U.S. Consumer Price Index (CPI) report, scheduled for release at 1230 GMT, is expected to show a rise in inflation, potentially influencing the Federal Reserve’s interest rate policy. Analysts predict an increase in CPI figures, which could reduce expectations of near-term rate cuts.
Most economists surveyed by Reuters anticipate the Federal Reserve will maintain interest rates for several more months amid inflation risks partly driven by President Donald Trump’s tariff policies.
Other precious metals saw mixed movements: spot silver declined slightly by 0.1% to $36.54 per ounce but remains near a 13-year high. UBS analysts expect silver prices to rise to $38 per ounce in the coming months, with potential to test $40 amid market deficits and a weakening U.S. dollar.
Platinum surged 2.9% to $1,257.06, reaching its highest level since May 2021. Palladium also rose 2.1% to $1,081.90.
Reporting by Anushree Mukherjee in Bengaluru; Editing by Joe Bavier
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