WASHINGTON (dpa-AFX) - Gold prices fell on Wednesday amid profit-taking from the recent upside movement triggered by the US tariff conflict with a few of its major trading partners as well as with rising optimism about a Fed rate cut.
Front Month Comex Gold for August delivery edged down by $1.90 (or 0.06%) to $3,380.00 per troy ounce today.
Meanwhile, front Month Comex Silver for August delivery crept up by 7.90 cents (or 0.21%) to $37.766 per troy ounce today.
US President Donald Trump had been vocally critical of the US Federal Reserve for keeping the benchmark lending rates higher despite the economy being resilient amid the ongoing tariff war between the US and its major trading partners.
The Fed had been resistant to all calls to lower rates, and after last week's monetary policy meeting, the Fed Chair went on to state that there was no decision about a rate cut in September.
Last week's economic data reflected bad jobs numbers and not-so-good inflationary numbers.
While traders staunchly feel that the Fed now has no option but to cut rates, Trump stated that soon he will be announcing a replacement for Fed Governor Adriana Kugler (who recently resigned) and also hinted that he may soon replace the current Chair too.
Gold being a dollar-denominated commodity, there is an inverse relation between both.
A low-interest regime would accelerate streamlined global trading and consolidate the US dollar.
Today, traders also opted for profit-taking from the recent highs the yellow metal saw, backed by the ongoing tariff war.
On the economic front today, the MBA Purchase Index in the US increased to 158 points in August 1 from 155.60 points in the previous week.
The yield on the 10-year US Treasury note hovered around 4.2% (near a three-month low) with investors more confident about the Fed easing its rigid policy stance.
The deadline given to Russia by Trump to agree to a ceasefire with Ukraine or else face steep sanctions on its billion-dollar oil exports ends in two days. To end the impasse, US envoy Steve Witkoff has been in Russia seeking an end the war.
Prospects for decreased US-Russia tensions also weighed on gold prices.
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