July 29, 2024
New Delhi, India
Gold prices(XAU/USD)
Gold prices climbed on Monday, driven by heightened geopolitical tensions in the Middle East and growing expectations of a U.S. rate cut in September. The focus now shifts to the Federal Reserve’s policy meeting later this week.
Key Highlights:
- Spot Gold: Spot gold increased by 0.3%, reaching $2,391.80 per ounce as of 0205 GMT. U.S. gold futures also firmed by 0.4%, trading at $2,390.50.
- MCX Gold Rate: After a significant decline of around 9% from its July 17, 2024 high, gold prices on the Multi Commodity Exchange (MCX) saw value buying at lower levels. On Thursday, MCX gold opened with an upside gap at ₹68,426 per 10 gm and touched an intraday high of ₹68,534 per 10 gm shortly after the market opened.
Market Drivers:
- US Inflation and Fed Rate Cut: According to commodity market experts, today’s rise in gold prices is attributed to cooling U.S. inflation and speculation about a rate cut by the Federal Reserve in its upcoming September meeting. The U.S. central bank’s Federal Open Market Committee is expected to keep rates unchanged at 5.25%-5.50% during the July 30-31 meeting. However, softer U.S. jobs data in June and dovish comments from top Fed officials have led the rate futures market to fully price in a 25 basis-point cut in September.
- Geopolitical Tensions: Increased geopolitical risks in the Middle East have also contributed to the demand for safe-haven gold. Gold, known for its stability as a hedge against geopolitical and economic uncertainties, performs well in a low-interest rate environment.
Indian Rupee Trades Flat Before Fed Rate Decision
Upcoming Data:
- US Economic Data: This week, the ADP national employment report and the non-farm payrolls report are the main data points to watch. These reports will provide further insights into the U.S. job market and potentially influence the Federal Reserve’s future policy decisions.
The recent surge in gold prices reflects the market’s response to a mix of geopolitical risks and economic indicators. As the Federal Reserve’s policy meeting approaches, investors will be closely monitoring the outcomes and any signals regarding future interest rate adjustments.
Ola Electric IPO: Open for Subscription on August 2; Valuation Expected at $4.4 Billion
Disclaimer:
CurrencyVeda provides this news article for informational purposes only. We do not offer investment advice or recommendations. Before making any investment decisions, please conduct thorough research, consult with financial experts, and carefully consider your financial situation, risk tolerance, and investment goals. Investing in the stock market carries risks, and it’s essential to make informed choices based on your individual circumstances. CurrencyVeda is not liable for any actions taken based on the information provided in this article.
