By Ambar Warrick

--Gold prices kept to a tight range on Tuesday after recovering slightly from their weakest level this year, as concerns over rising interest rates and anticipation of key U.S. economic readings this week kept traders largely to the sidelines.

The yellow metal marked four consecutive weeks of losses as hotter-than-expected U.S. inflation and signs of economic resilience in the country drummed up fears that the Federal Reserve will have enough economic headroom to keep raising interest rates.

was flat at $1,817.51 an ounce, while fell slightly to $1,824.20 an ounce by 20:55 ET (01:55 GMT). Both instruments recovered from a two-month low on Monday. 

Focus this week is on U.S.  (PMI) readings for February, which are expected to show some cooling in economic activity as the world’s largest economy struggles with high inflation and rising interest rates. 

But the Fed has signaled that it is seeking a further cooling in growth before it can consider pausing its pace of rate hikes. While a majority of traders are by the central bank during its March meeting, a small group is positioning for a return to a 50 bps hike, given the recent stubbornness in inflation.

Rising interest rates bode poorly for metal markets, given that they increase the opportunity cost of holding non-yielding assets. This trade had decimated metal prices in 2022, and is expected to weigh on the market in the near-term.

Other precious metals moved in a flat-to-low range on Tuesday. rose 0.2% to $942.70 an ounce, while sank 0.4% to $20.715 an ounce.

Among industrial metals, copper prices fell slightly but kept to a tight range as traders awaited key Chinese business activity data this week.

fell 0.2% to $4.0018 a pound, and were trading just above a near two-month low.

Chinese is due on Wednesday, and is expected to show that an economic recovery in the world’s largest copper importer remained mixed through February. 

While the is expected to grow further from 2022 lows, the is expected to remain in contraction territory.