Gold prices fall as PCE data looms; Set for a strong August by Investing.com

Investing.com– Gold prices edged lower in Asian trade on Friday but remained near record highs as markets awaited more interest rate cues from key U.S. inflation data later in the day.

But bullion prices were set for strong gains in August as a combination of haven demand and interest rate cut expectations pushed the yellow metal to record highs.

was down 0.3% at $2,514.55 an ounce, while December expiry was down 0.5% at $2,547.80 an ounce by 01:08 ET (05:08 GMT) .

Gold braces for strong August, PCE data in focus

Spot prices were set to gain about 2.8 percent in August after hitting a record high of $2,531.72 an ounce earlier in the month.

Tensions in the Middle East boosted demand for safe-haven gold, as did a rout in risk-on markets earlier in the month. Signs of continued central bank buying in emerging markets also supported prices.

But gold’s biggest support has been expectations of lower US interest rates, presenting a more accommodative environment for investing in the yellow metal.

Data on the PCE price index – the Federal Reserve’s preferred gauge of inflation – is due later on Friday and is expected to provide more clues about interest rates.

PCE data is expected to show that inflation remained sticky in July, which, along with recent signs of resilience in the US economy, could give the Fed less impetus to cut interest rates sharply. The dollar strengthened on this notion and was headed for a weekly gain.

But traders are still pricing at a discount of at least 25 basis points in September, it showed.

Among other precious metals, and were mixed on Friday, but lagged well into August.

Copper strong on China stimulus hopes

Among industrial metals, copper prices rose on Friday after reports of more stimulus measures in China, the top copper importer, boosted sentiment.

The London Metal Exchange benchmark rose 0.5 percent to $9,324.50 a tonne, while on the month it rose 0.8 percent to $4.2447 a pound.

Media reports said Beijing is considering refinancing about $5.4 trillion in mortgage loans – a move that is likely to provide a chance for China’s beleaguered housing market.

The property market is a major source of demand for Chinese copper, a slowdown in the sector that has fueled lingering concerns about slowing Chinese demand for the red metal.