Gold prices rose slightly in Asian trade on Wednesday as markets navigated mixed signals on the U.S.-Israel war with Iran, with focus squarely on disruptions in energy markets and a potential end to the conflict.
Upcoming U.S. consumer inflation data for February will also be watched for more cues on the world’s largest economy, although the print is unlikely to reflect heightened energy prices stemming from the Iran war.
Spot gold rose 0.2% to $5,204.29 an ounce by 01:17 ET (05:17 GMT), while gold futures fell 0.5% to $5,213.11/oz.
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Gold breaks above $5,200/oz amid mixed Iran signals Wednesday’s gains saw gold break above a $5,000 to $5,200/oz trading range seen over the past week, although it remained to be seen whether this could be sustained.
The yellow metal has logged wild swings after tumbling from a near $5,600/oz record high in late-January.
Mixed signals on the Iran war also made for whipsaw trade this week. U.S. President Donald Trump said late-Monday that the war was close to ending. But strikes between the U.S., Israel, and Iran showed few signs of easing by the early hours of Wednesday– marking a twelfth consecutive day for the conflict.
Markets fear that heightened energy-driven inflation could elicit a more hawkish stance from global central banks– a scenario that bodes poorly for gold. This notion limited overall gains in gold, even as bullion benefited from rapidly increasing safe haven demand.
Other precious metals were muted on Wednesday. Spot silver fell 0.1% to $88.2245/oz, while spot platinum rose 0.3% to $2,208.89/oz.
US CPI data awaited for more cues U.S. CPI data for February is due later on Wednesday and is expected to provide more clear cues on inflation and interest rates in the world’s largest economy.
Headline CPI inflation is expected to remain steady at 2.4% year-on-year, while core CPI is expected to remain at 2.5%.
While the print is unlikely to reflect the surge in energy prices following the Iran war, it will still be closely watched for more insights on consumer spending and overall economic health.
The CPI print comes after a key payrolls reading for February read much weaker than expected, raising some concerns over whether the U.S. economy was cooling.
