Fed's monetary policy direction brings upward movement in gold prices
Gold prices have been on a steady rise this week, with a 0.7% increase so far. This upward trend has been observed in both futures and spot markets. At 12:18 am EDT on Friday, gold prices reached $3,669.19 per ounce.
The surge in gold prices has not deterred investors, particularly in India, who have been buying bullion in anticipation of further gains. This bullish sentiment is reflected in the record gold prices in India.
Meanwhile, market strategist Bob Haberkorn from RJO Futures predicts that gold prices could reach $4,000 before the end of the year. Haberkorn sees investors turning to platinum and silver as they are more affordable alternatives to gold.
Platinum firmed 1.3% to $1,401.40, while spot silver rose 2.1% to $42.67 per ounce. The U.S. Federal Reserve's rate cut was followed by warnings about persistent inflation, which could potentially increase the demand for non-yielding assets like gold.
The U.S. Federal Reserve delivered its first rate cut of the year on Wednesday, reducing its key interest rate by 25 basis points. Following the Fed's decision, spot gold prices hit a record high of $3,707.40. However, the gold market has been volatile since hitting this high.
Physical gold premiums in India have risen to a 10-month high this week, while physical gold discounts in China have widened to a five-year peak. This trend suggests that the demand for gold is strong, but the supply is tight, particularly in China.
Fed Bank of Minneapolis President Neel Kashkari predicts rate cuts at the central bank's next two meetings. This could potentially further boost the demand for gold, as lower interest rates make non-yielding assets like gold more attractive to investors.
However, it's worth noting that the name of the RJO Futures market strategist who made these statements is not provided in the available search results. Despite this, the trends in gold prices and investor sentiment remain clear.
In conclusion, gold prices are on the rise, and investors are turning to alternatives like platinum and silver. The U.S. Federal Reserve's rate cut and warnings about persistent inflation could potentially increase the demand for gold. The demand for physical gold remains strong, particularly in India, despite the high prices. The future of gold prices remains uncertain, but with predictions of further rate cuts and potential increases in demand, gold could continue to be a popular investment choice.
Read also:
- Potential Consequences of Dismantling FEMA Vary Across States
- Railway line in Bavaria threatened by unstable slope - extensive construction site at risk
- Wind Farm Controversy on the Boundary of Laois and Kilkenny
- Puerto Rico's Climate Lawfare Campaign experiences another setback with the dismissal of its deals.
