Gold prices remained near a record high on Monday as investors awaited a series of speeches from U.S. Federal Reserve officials and upcoming inflation data. Last week, the central bank cut interest rates and hinted at the possibility of further easing. As of 0217 GMT, spot gold edged up 0.1% to $3,688.76 per ounce, with bullion hitting a record high of $3,707.40 last Wednesday. U.S. gold futures for December delivery also rose 0.5% to $3,723.70.
According to KCM Trade Chief Market Analyst Tim Waterer, there is significant potential for gold to reach new high watermarks this week and surpass the $3,700 level. The dovish stance of the Federal Reserve, combined with ongoing central bank buying, has propelled gold's momentum in the market.
Market attention has now shifted towards the release of the U.S. core Personal Consumption Expenditure (PCE) price index, which serves as the central bank's preferred inflation gauge, set to be revealed on Friday. At least twelve Fed officials are scheduled to speak this week, providing investors with further insights into the central bank's monetary policy outlook.
Following Wednesday's 25 basis point interest rate cut by the Federal Reserve and concerns about persistent inflation, investor expectations are leaning towards two more rate cuts this year – 25 basis points each in October and December. According to the CME FedWatch tool, there is a 93% and 81% probability for rate cuts in October and December, respectively.
Gold, which typically thrives in a low-interest-rate environment, has surged over 40% this year amidst global geopolitical and economic uncertainty, continued central bank buying, and monetary policy easing. In parallel, spot silver rose 0.3% to $43.20 per ounce, remaining close to a 14-year high, while platinum slightly declined to $1,398.40 and palladium saw a slight increase to $1,150.75.
With the upcoming speeches from Federal Reserve officials and crucial inflation data on the horizon, the gold market remains poised for potential further gains as investors digest the latest developments in monetary policy and global economic conditions.
