Gold Prices Rise Amid Trade Concerns and Federal Reserve Actions

Gold prices rose during Wednesday's trading, supported by investors' concerns over US trade escalation and its impact on the economy, along with inflation data showing a rise in US consumer prices in June.

Spot gold received strong support, rising by 0.4% to $3338.34 per ounce, while US gold futures increased by 0.2% to $3344.10.

This increase comes amidst growing expectations regarding US President Donald Trump's trade policy, who recently threatened to impose a 30% tariff on imports from Mexico and the EU starting August, before later expressing openness to further negotiations.

Brian Lan, General Manager of GoldSilver Central in Singapore, stated, "Gold is experiencing an accumulation phase with a slight downward trend, especially with the strength of the dollar," adding that "continuation of trade negotiations between the US and its partners increases market uncertainty, boosting demand for safe havens like gold."

On the other hand, official data showed a rise in consumer prices at the highest pace in five months, raising concerns about the impact of tariffs on inflation, which may lead the US Federal Reserve to postpone interest rate cuts until September.

President Trump commented on the data saying, "Price levels are still low," urging the Fed to immediately cut interest rates. Conversely, Dallas Fed President, Loretta Mester, indicated that the central bank may need to keep interest rates unchanged for a longer period to address inflation pressures.

Gold remains an attractive option for investors in times of economic uncertainty, benefiting from lower interest rates. In this context, market participants are looking towards US Producer Price Index data to be released later today, seeking further signals on inflation trends.