IGI Logo

Gold prices held steady on Tuesday while investors strapped in for U.S. economic data this week for clarity on the timeline for Federal Reserve's interest rate cut.

Spot gold was nearly unchanged at $2,396.57 per ounce, as of 0458 GMT. U.S. gold futures added 0.1% to $2,398.00.

Traders will eye the report on second-quarter gross domestic product (GDP) on Thursday and personal consumption expenditures (PCE) data for June on Friday.

"Gold looks quite comfortable around $2,400 for now, so there is the chance of a minor bounce heading into GDP," City Index senior analyst Matt Simpson said.

But, "should growth surprise to the upside, I still think gold can hold above $2,360 in the current environment."

Gold prices scaled an all-time high of $2,483.60 last week, with markets broadly pricing in a 25-basis-point U.S. rate cut by September. Lower rates reduce the opportunity cost of holding bullion.

On the political front, U.S. Vice President Kamala Harris will campaign in the state of Wisconsin for the first time as a presidential candidate after enough Democratic delegates pledged to endorse her, clearing her path to the nomination.

While accepting the Republican nomination, Donald Trump pledged to cut corporate taxes and interest rates. Lower tax revenues could widen the U.S. federal government's budget deficit. Many investors believe the deficit will keep deteriorating under a second Democratic administration too.

"While there is a lack of a clear pre-election commodities trade given the range of scenarios that could play out, gold stands out as a winner," JP Morgan said in a note.

"Structurally bullish drivers for gold, like growing concerns on complacency over the rise in fiscal debt, tariffs, and trade retaliations as well as broad America First rhetoric, are likely to remain intact."

Spot silver fell 0.7% to $28.98, platinum was flat at $946.79 and palladium lost 0.4% to $904.44.