Will gold continue to reach new record levels?
Gold stabilized near a new record level after two officials from the Federal Reserve stated they still expect the U.S. central bank to cut interest rates three times this year, boosting the prospects for precious metals.
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Gold prices rose, reaching a new record level above the $2,300 per ounce threshold yesterday,
before stabilizing around $2,291.
San Francisco Federal Reserve Bank President Mary Daly and her counterpart in Cleveland,
Loretta Mester, both of whom have voting rights on this year’s monetary policy decisions,
said it is likely that three reductions in U.S. interest rates will be applied during 2024,
although there is no urgent need to take these steps quickly.
Low interest rates benefit precious metals, which do not yield a return.
Gold Prices
Since the beginning of 2024 until now, the price of gold has jumped by approximately 11%, recording a series of record figures amid this rise, amid expectations that the Federal Reserve is close to taking a step to cut U.S. interest rates.
Data this week showed an unexpected rebound in the U.S. manufacturing sector, with rising raw material prices, raising concerns about the possibility of a return to inflation. With the general rise in basic commodity prices, this brings the risk of another round of inflation, so investors may hedge against inflation and buy gold.
Federal Reserve Chairman Jerome Powell is scheduled to make statements later on Wednesday, which may reveal new indicators about U.S. monetary policy expectations.
The markets are looking forward to tomorrow’s release of non-farm payroll data, which is expected to rise strongly.
Will gold continue to reach new record levels?