Gold Prices Surge as Harris-Trump Debate Sparks Uncertainty Over 2024 Elections

Gold prices surged in Asian trade on Wednesday, nearing record highs as uncertainty over the 2024 elections intensified following a fiery debate between presidential candidates Kamala Harris and Donald Trump. The debate, marked by heated rhetoric and diverging economic policies, fueled safe-haven demand for gold and the Japanese yen, while the dollar weakened and U.S. stock index futures declined, signaling a shift in risk appetite.

Spot gold rose 0.1% to $2,519.73 an ounce, while gold futures for December delivery climbed 0.2% to $2,548.45 an ounce. The precious metal’s gains were supported by a retreat in the dollar post-debate, with spot prices hovering just below a record high of $2,532.05 an ounce.

Investors are also awaiting a key U.S. consumer price index (CPI) inflation reading later in the day, which is expected to show a further cooling in inflation. This could provide the Federal Reserve with more confidence to begin reducing interest rates, with a rate cut of at least 25 basis points anticipated at the upcoming Fed meeting. However, recent signs of economic resilience have tempered expectations for a larger rate cut, leading to a pullback in gold prices.

In addition to gold, other precious metals also saw gains on Wednesday. Platinum futures rose 0.1% to $945.50 an ounce, while silver futures climbed 0.6% to $28.777 an ounce, although both metals have lagged behind gold in recent months.

Meanwhile, copper prices rebounded as they recovered from recent losses, but concerns over China’s slowing demand for the industrial metal and the potential for a trade war with the West kept sentiment fragile. Benchmark copper futures on the London Metal Exchange rose 0.7% to $9,086.0 a ton, while one-month copper futures increased 0.6% to $4.1285 a pound.

The looming threat of a renewed trade war between the U.S. and China added to market jitters, with U.S. lawmakers considering new restrictions on Chinese industries. Beijing has criticized these measures, raising the specter of escalating tensions between the two economic powerhouses.

Overall, the combination of political uncertainty, economic data releases, and geopolitical tensions continues to drive volatility in the markets, with investors closely monitoring developments for potential opportunities and risks. As gold prices near record highs and other metals show mixed performance, the landscape remains dynamic and unpredictable, underscoring the importance of staying informed and agile in navigating the ever-changing financial environment.