Investing.com — Gold prices were little moved in holiday-slow Asian trading on Monday, with the yellow metal trading in the past week as traders looked for further clues from upcoming U.S. inflation data. The range was maintained.
Among industrial metals, KoBold Metals, a startup backed by Microsoft (NASDAQ:) founder Bill Gates, has discovered a large copper deposit in Zambia that could form a large-scale copper mine. As a result, copper prices hit their lowest level in about three months.
Gold prices returned to a trading range of $2,000 to $2,050 in February as the market began to steadily price in the possibility of rate cuts in March and May as expectations for early rate cuts by the Fed receded.
A lack of immediate cues last week didn't help gold, and traders are now looking to upcoming Consumer Price Index (CPI) data for the next big signal.
By 12:07 ET (5:07 p.m. Japan time), the price fell 0.1% to $2,023.48 an ounce, compared with $2,037.20 an ounce for April expirations. Trading volumes in both countries decreased due to market holidays in China, Hong Kong, South Korea, and Japan.
Pay attention to CPI data and feed signals
Little movement is expected in gold ahead of the US on Tuesday. The data is expected to show that inflation eased further in January, but price pressures are still expected to remain well above the Fed's annual rate target of 2%, with the Fed expected to keep interest rates unchanged for an extended period of time. This provides further driving force to maintain high standards.
In addition to the inflation data, there will also be commissions this week from Fed officials, including , , and .
Fed officials are expected to repeat recent comments that the central bank is in no hurry to start cutting interest rates. Given that rising interest rates push up the opportunity cost of investing in the yellow metal, this idea led to significant losses for gold in early February.
In addition, gold prices continue to be under pressure as they are eyeing a new three-month high.
Still, gold managed to break above the $2,000 an ounce support, but analysts warned that this level could be tested in the coming days.
Large deposit discovered in Zambia, sinking copper
Copper prices fell on Monday, widening losses from the previous session on concerns about a possible increase in global supplies.
The closing price for the March expiry fell 0.4% to $3.6727 per pound, the lowest since mid-November.
Kobold Metals, a startup backed by Microsoft founder Bill Gates, has announced the discovery of a huge copper deposit in Zambia that could become one of the world's largest mines.
Zambian President Hakainde Hichilema said the deposits discovered at the Mingomba project could produce between 5 and 600,000 tonnes of copper when operational. By comparison, Chile's Escondida mine, considered the world's largest copper mine by production, produced about 1 million tons of copper in 2022.
The discovery points to the potential for copper supplies to increase in the coming years, putting further pressure on prices for the red metal, which typically benefits from tight market conditions.
Copper has already suffered significant losses in 2024 due to persistent concerns about slowing demand from China, its largest importer.
