September 16, 2024
New Delhi, India
Gold Prices
Gold (XAU/USD) prices have continued their upward trend, nearing an all-time high of $2,590 as the European session begins. This marks the third consecutive day of gains for the precious metal. Falling US Treasury yields and a weaker US Dollar, driven by expectations of a more aggressive policy easing by the Federal Reserve, have been key factors boosting demand for the non-yielding yellow metal.
Key Factors Driving Gold’s Rise:
- Fed Rate Cut Bets: Investors are increasingly expecting a 50 basis point (bps) rate cut by the Federal Reserve later this month, following softer-than-expected inflation data. According to the CME Group’s FedWatch Tool, the probability of such a cut is now over 50%.
- Geopolitical Uncertainty: Ongoing geopolitical tensions, including the prolonged Russia-Ukraine war and instability in the Middle East, have fueled demand for safe-haven assets like gold. Reports of a second attempted assassination on Donald Trump have also added to the uncertainty.
- Upcoming Central Bank Meetings: Traders are cautious ahead of this week’s major central bank events, including the Federal Open Market Committee (FOMC) meeting on Wednesday, followed by the Bank of England and Bank of Japan meetings on Thursday and Friday, respectively. These meetings could introduce significant volatility and shape the future direction of gold prices.
Also Read: USDINR Today: Indian Rupee Trades Weaker Despite Global Influences, Investors Eye Key Economic Data
Despite the bullish sentiment, some investors are holding off on making aggressive bets until after the FOMC meeting. Additionally, a generally positive tone across global equity markets may limit gold’s gains in the short term.
As the week progresses, traders will be closely monitoring the outcomes of these central bank meetings for further direction.
Disclaimer:
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