Gold prices near record highs as recession fears ease By Investing.com

Investing.com– Gold prices edged lower in Asian trade on Friday as easing recession fears curbed safe-haven demand, although lingering interest rate cut expectations kept the yellow metal near record highs.

Prices also headed for a slightly positive week, although overall gains were capped by traders pricing in a smaller interest rate cut in September.

was down 0.1% at $2,453.02 an ounce, while December expiry was down 0.1% at $2,490.15 an ounce by 01:08 ET (05:08 GMT) .

Gold heads for weekly gains amid reduced bets

Spot prices traded up 0.9% on the week and were about $30 off a record high.

Weak inflation data released earlier this week fueled increased bets that the Federal Reserve will cut interest rates in September, although a monthly pick-up in consumer inflation saw traders favor a 25 basis point cut versus a rate cut of 50 bps.

The stronger-than-expected data also inspired more confidence in the US economy, while denting expectations for a bigger rate cut.

But the prospect of lower rates still bodes well for gold as it lowers the opportunity cost of investing in non-performing assets.

Lingering concerns about an all-out war in the Middle East between Iran and Israel also kept a safe haven demand for gold in play.

Analysts at Alpine Macro recommended buying gold on the chance of worsening conditions in the Middle East, particularly if Iran is set to retaliate against Israel for killing a Hamas leader in Tehran.

Prices of other precious metals fell on Friday, but also had some gains this week.

was down 0.5% at $957.85 an ounce, while it was down 0.7% at $28.207 an ounce.

Copper margins are smaller, but the Escondida strike brings weekly gain

Among industrial metals, copper prices fell slightly on Friday but were set for their first weekly gain in six as a strike at the world’s largest copper mine presented a tighter outlook for supply.

The London Metal Exchange benchmark fell 0.2 percent to $9,128.0 a tonne, while on the month it fell 0.1 percent to $4.1368 a pound. Both contracts rose about 3 percent this week, snapping a five-week losing streak.

Workers at Chile’s Escondida mine, which accounts for 5 percent of global copper supplies, went on strike this week over disputes over compensation.

Any extended production outage at Escondida portends a tighter outlook for global copper supplies, which is expected to support prices.

But copper’s higher gains were dampened by lingering concerns about sluggish copper demand, especially after a series of weak economic reviews from top copper importer China.