Gold prices climbed Wednesday, recovering after the yellow metal took a sharp hit a day earlier. Buyers emerged to scoop up bargains and watch closely for upcoming United States economic data and central bank signals.
The price of spot gold rose 0.6 % to $3,319.61 an ounce by late morning. On the day before that, it fell below $3,300, hitting a low of $3,285.19. U.S. gold futures did the same, climbing 0.6% to $3,318.60.
Analysts cited bargain hunters as the reason for the bounce. Traders were positioning for key updates from the U.S. central bank and fresh economic indicators later this week.
The minutes of the latest Federal Reserve policy meeting are likely to be released next. "Those will be subsequent to personal consumption expenditure and inflation. A number of central bank officials are also set to speak in the coming days, potentially providing more insight into interest rate decisions.
If inflation numbers are weaker than expected, fears of stagflation could subside, experts say. That could raise the likelihood of further rate cuts and bolster gold prices. Investors often look to gold in times of economic uncertainty or when they anticipate interest rates are going to fall.
Gold has had a rocky month. Prices dropped to about $3,200 earlier this month but have rebounded. Changing inflation patterns, bond yields, and global tensions have contributed to market volatility.
Monetary authorities must respond forcefully when inflation drifts from target, a top central bank official said on Wednesday. That remark adds to the sense of caution that many investors have about future rate moves.
Some market observers are positive about gold's longer-term prospects. Price projections call for gold at $3,685 in the third quarter and $3,850 at year-end. Other recent financial analysts did raise their near-term gold forecast to $3,500 an ounce. They attribute the increase to rising tariffs and geopolitical tensions, among other factors.
Other precious metals, meanwhile, were also higher. Silver added 0.2% to $33.35 per ounce. Platinum added 1.3% to $1,093.55. Palladium was unchanged at $978.27.
