Precious Metals Face Headwinds
Gold and silver prices experienced downward pressure during the Asian session, with both metals retreating from recent gains. Gold's upward momentum stalled as a stronger US Dollar and concerns over oil-driven inflation risks attracted sellers, while silver's price declined amid uncertainty surrounding geopolitical developments in the Middle East.
US Dollar Finds Support Amid Fading Rate Hike Bets
The US Dollar demonstrated resilience despite diminishing expectations for further Federal Reserve interest rate hikes. While a softer outlook on Fed policy weighed on the greenback against several major currencies, it found support from safe-haven demand stemming from escalating geopolitical tensions and associated inflation concerns.
Geopolitical Tensions Bolster Crude Oil Prices
Heightened geopolitical risk in the Middle East provided firm support for crude oil prices, which held near multi-week highs. An incident reported in the Strait of Hormuz, coupled with ongoing assessments of regional conflicts, contributed to market uncertainty and kept West Texas Intermediate (WTI) crude trading around the $84 per barrel mark.
Weaker Chinese Data Signals Economic Slowdown
Economic indicators from China pointed to a slowdown, weighing on broader market sentiment. Weaker-than-expected retail sales and industrial production figures for July impacted currencies sensitive to Chinese economic health, while the People’s Bank of China set a weaker daily reference rate for the yuan.
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