Gold Prices Fall in Asian Trade, Heading for Weekly Losses Amid Positive U.S. Labor Data

Gold prices fell in Asian trade on Friday as positive U.S. labor data sparked a recovery in risk appetite and sapped some safe haven demand, putting the yellow metal on course for some weekly losses. Spot gold fell 0.4% to $2,419.23 an ounce, while gold futures expiring in December fell 0.2% to $2,459.10 an ounce by 01:40 ET (05:40 GMT).

Among industrial metals, copper prices also benefited from improved risk appetite, while positive inflation data from top importer China boosted sentiment. But the red metal was nursing steep losses for the week. Benchmark copper futures on the London Metal Exchange rose 0.8% to $8,896.50 a ton, while one-month copper futures rose 0.8% to $4.0150 a pound.

Spot prices were down nearly 1% this week, coming off near record-high levels hit last week as fears of a recession ramped up safe haven demand for the yellow metal. But these fears eased through the week, especially as some strong readings on the labor market suggested that a drastic slowdown may not be on the cards. Weekly jobless claims data read better than expected on Thursday, sparking a sharp rebound in risk-driven markets, particularly stocks, and pressuring some safe haven demand for gold.

However, losses in the yellow metal were limited as investors largely maintained bets that the Federal Reserve will cut interest rates in September. Lower rates reduce the opportunity cost of investing in gold. This notion buoyed other precious metals, although they also fell on Friday and were headed for weekly losses. Platinum futures fell 0.1% to $941.20 an ounce, while silver futures fell 0.3% to $27.535 an ounce.

Some positive data from top importer China spurred some gains in copper. Consumer price index inflation data for July grew more than expected, while producer price index inflation shrank less than expected. The data helped spark some bets that demand was improving in China. However, other readings earlier this week, especially import data, showed the country’s copper imports shrank for a second straight month in July.

Overall, gold and copper prices were influenced by a mix of factors including U.S. labor data, inflation data from China, and market sentiment. While gold was on track for mild weekly losses, it remained close to record highs, reflecting ongoing uncertainty in the global economy. Copper, on the other hand, saw some gains on positive China inflation data but was still facing weekly losses.

Investors will continue to monitor economic indicators and central bank policies for further clues on the direction of precious metal prices in the coming weeks. The interplay between risk appetite, safe haven demand, and macroeconomic factors will likely continue to drive volatility in the gold and copper markets.