Gold prices hit a new record high on Tuesday, surpassing $3,500 per ounce this morning. Investors have become increasingly attracted to gold due to the weakness of the US dollar and expectations that the US Federal Reserve will cut interest rates this September. That is why the price of the commodity has increased. The price of gold rose to $3,508.50 per ounce in the global market on Tuesday. Gold prices have risen more than 30 percent so far this year.
Kyle Rodda, financial market analyst at Capital.com, said the weak economic outlook and the prospect of a U.S. interest rate cut are boosting precious metals markets, including gold. According to him, another reason is that President Donald Trump’s interference in the independence of the US central bank, the Federal Reserve, or the Fed, has created a crisis of confidence in dollar-based assets.
Currently the price of Gold is up 1.4% to $3,596 per ounce. And it is expected the price of gold may increase further in December, exceeding $3,600 per ounce. Experts says the unusual appreciation in gold prices is due to the weakness of the US dollar, central bank purchases, a soft monetary policy backdrop, and political and economic uncertainty.
Gold prices rose 27 percent in 2024. In March of this year, uncertainty over Trump’s trade policy prompted investors to flock to safe havens, and the price crossed $3,000 per ounce for the first time.
Another piece of data shows that since August, the rate of employment growth in the United States has slowed significantly, leading to an 4.3%, worsening labor market conditions. A survey also found that 95% of central banks believe they have enough gold reserves in their treasuries but the reality is completely different, while many countries are now looking for alternatives to the dollar after Russia’s war in Ukraine, the United States is using its dollar against Russia. As a result the central bank’s gold purchases increased and the price of gold increased dramatically.
Meanwhile, investors are now looking ahead to the US non-farm payrolls data due next Friday, as it will determine how much the Fed can cut interest rates later this month. On the other hand, the price of silver was almost unchanged yesterday, at $40.64 per ounce. Earlier, the price of silver had reached its highest level since September 2011.
Source: Click here
