Gold Hits Record High Amid Weaker Dollar, Fed Rate Cut Bets
Spot gold rose 1.3 per cent to USD2,489.12 per ounce, after reaching an unprecedented high of USD2,500.99 earlier in the day
The price of gold surged to a record high as the US dollar weakened, driven by positive macroeconomic data that led Wall Street to increase bets on a potential interest-rate cut by the US Federal Reserve in September. Geopolitical tensions in the Middle East further fueled demand for the precious metal.
Spot gold rose 1.3 per cent to USD2,489.12 per ounce, after reaching an unprecedented high of USD2,500.99 earlier in the day. US gold futures also climbed, up 1.4 per cent to USD2,527.80. The precious metal has seen a significant rise of 2.4 per cent over the past five days. The dollar index fell by 0.3 per cent and was on course for a fourth consecutive week of losses, making gold more attractive to international buyers.
In the broader metals market, silver edged down 0.2 per cent to USD 28.35 per ounce, platinum declined 1 per cent to USD 943.10, and palladium slipped 0.9 per cent to USD 935.43. Despite these minor setbacks, all three metals were poised for weekly gains. Meanwhile, in domestic trading, gold futures on the Multi Commodity Exchange (MCX) dropped by 1.28 per cent, settling at Rs 6,404 per 10 grams.
Gold's Rally: What's Behind the Surge?
Analysts attribute gold's unprecedented surge past the USD2,500 mark to two weeks of volatile trading, during which bullish sentiment ultimately prevailed. Market attention is now turning to the upcoming Jackson Hole Economic Symposium, where Federal Reserve Chair Jerome Powell is set to deliver remarks on the economic outlook next Friday. Powell's speech is highly anticipated, as it could provide clearer guidance on the likelihood and timing of future rate cuts.
