Gold prices continue to rise, remaining near record levels. On Monday, the stake of gold went up by 0.2%, reaching $ 2,469.35 per ounce. This is only a little less than a record maximum of $ 2,483.60 reached last month. Futures for American gold stabilized at $ 2,508.40.
Precious metal support comes from two main sources: waiting for interest rates in the US and continuing tension in the Middle East. Both factors create favorable conditions for rising gold prices.
Perspectives to reduce rates in the United States
Reduction in the United States is expected to be one of the key factors that will affect the price of gold in the near future. If inflation data confirms the slowdown in prices, the chances of reducing the rate by 50 base points will increase in September. This, in turn, can push the price of gold to new records.
The latter data indicate that inflation in the US remains moderate. Producers in July increased less than expected, indicating a slowdown in inflation. According to forecasts, monthly inflation in the United States will increase by 0.2%, and annual basic inflation will slow down to 3.2%. Consumer prices index data will be published at 12:30 on Greenwich, which can give more clarity regarding the future of the federal reserve policy.
According to CME Fedwatch Tool, the probability of reducing the rate by 50 base points in September is estimated at 52.5%. Reduction of rates reduces the alternative cost of having gold, making it a more attractive investment asset.
Gold also receives support because of geopolitical risks, in particular because of tension in the Middle East. In the face of global political instability, investors traditionally turn to gold as a safe asset, which allows to keep capital during uncertainty.
Against the background of increased tensions in the region and potential conflicts, gold remains a popular choice among investors looking for ways to hedge their risks.
