Gold prices rose during trading on Tuesday, boosted by comments from Federal Reserve Chairman Jerome Powell that strengthened the case for a September interest rate cut. Investors are awaiting more U.S. economic data for further monetary policy signals.
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“Powell has continued to lay the groundwork for monetary policy easing. The September rate cut has now been fully priced in by markets, which might keep gold sentiment well supported,” said IG market analyst Yip Jun Rong.
Powell stated on Monday that the three U.S. inflation readings in the second quarter of this year “add some confidence” that the pace of price increases is returning to the Fed’s target in a sustainable way. This suggests a shift to lower interest rates may be imminent.
When interest rates fall, non-yielding bullion (like gold) typically becomes more appealing to investors.
Investors are looking towards US retail sales data, due at 15:30 Riyadh time on Tuesday, as well as comments from Federal Reserve Governors Christopher Waller and Adriana Kogler later this week for further guidance on the Fed’s monetary policy stance.
A weak retail sales report might support gold prices based on dovish Fed bets, while a strong report would signal a continuation of the overall bullish trend for gold, potentially making $2,600 the next target, Yip said.
Gold at settlement yesterday
Gold prices rose during trading on Monday, as markets absorbed the comments of Federal Reserve Chairman Jerome Powell. This extended the yellow metal’s winning streak to the third week in a row.
At settlement, gold futures for August delivery rose 0.35%, or $8.2, to $2,428.9 per ounce.
Gold and dollar now
Futures are now up 0.5% at $2,440 an ounce.
Spot gold rose by regarding 0.56% to $2,436 per ounce. On Monday, prices reached their highest level since May 20, when bullion rose to a record peak of $2,449.
The US dollar (DXY) rises by regarding 0.11% to 103.995 points.
Other minerals
Spot gold fell 0.9 percent to $30.72 an ounce, while platinum fell 0.4 percent to $991.40. Silver rose 0.2 percent to $951.84.
Gold Prices Surge Amidst Powell’s Rate Cut Hints
Gold prices saw a surge on Tuesday, driven by comments from Federal Reserve Chairman Jerome Powell that strengthened the case for an interest rate cut in September. The market anticipates further monetary policy signals from upcoming economic data releases.
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“Powell has continued to lay the groundwork for monetary policy easing. The September rate cut has now been fully priced in by markets, which might keep gold sentiment well supported,” said IG market analyst Yip Jun Rong.
Powell’s remarks on Monday, indicating that three recent inflation readings “add some confidence” in the Fed’s ability to achieve its target rate, hinted at a shift towards lower interest rates. This shift makes gold, a non-yielding asset, more attractive to investors.
Awaiting U.S. Economic Data
Investors are eagerly awaiting U.S. retail sales data scheduled for release at 15:30 Riyadh time on Tuesday. Further guidance is expected from Federal Reserve Governors Christopher Waller and Adriana Kogler later this week. A weak retail sales report might further support the case for a rate cut, bolstering gold prices. Conversely, a strong report might signal continued bullish momentum for gold, potentially pushing prices towards the $2,600 mark, Yip said.
Gold’s Recent Performance
Gold prices closed higher on Monday, extending their winning streak to a third consecutive week, as market participants absorbed Powell’s comments. August gold futures rose 0.35%, or $8.2, to settle at $2,428.9 per ounce.
Gold’s Current Status
Gold futures are currently trading up 0.5% at $2,440 an ounce. Spot gold, on the other hand, is up 0.56% at $2,436 per ounce, reaching its highest level since May 20, when it peaked at $2,449.
The U.S. dollar index, a measure of the dollar’s strength once morest a basket of major currencies, is up 0.11% at 103.995 points.
Other Precious Metals
Spot silver is down 0.9 percent at $30.72 an ounce. Platinum is down 0.4 percent at $991.40, while palladium is up 0.2 percent at $951.84.
