{"id":15083,"date":"2024-09-23T03:45:27","date_gmt":"2024-09-23T03:45:27","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=15083"},"modified":"2024-09-23T03:45:27","modified_gmt":"2024-09-23T03:45:27","slug":"gold-prices-near-record-highs-as-feds-aggressive-rate-cut-drives-demand","status":"publish","type":"post","link":"https:\/\/www.global-vtrader.com\/en\/analysis\/gold-prices-near-record-highs-as-feds-aggressive-rate-cut-drives-demand\/","title":{"rendered":"Gold prices near record highs as Fed\u2019s aggressive rate cut drives demand"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><strong>Key points:<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Spot gold steadied at $2,619.37 per ounce, close to the record high set last Friday.<\/li>\n\n\n\n<li>U.S. gold futures edged down by 0.1%, trading at $2,643.90 per ounce.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p class=\"wp-block-paragraph\">Gold prices remained strong after the U.S. Federal Reserve cut rates by half a percentage point last week. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">With further rate cuts expected by the year\u2019s end, gold continues to attract demand, as lower interest rates typically boost the appeal of zero-yield assets like gold.<\/p>\n\n\n\n<figure class=\"wp-block-image is-resized\"><img decoding=\"async\" src=\"https:\/\/lh7-rt.googleusercontent.com\/docsz\/AD_4nXeRMzXZ9BA5Qx7nGNfWh8-n0f4HAu4SWtkn5q8st8uhSt5dnq6B6vAh2ppid3i2pdVEtSjuCRjnxTWPoMNjr9ppWkSlBimGeMSGI2IZ0Hj2TiwkPz8zy8H6JiQDyTaAD7cDj2w3acBYvc91_pEwkbufF5ww?key=DV6qx4sxu8aOaPqiGEfpXg\" alt=\"\" style=\"width:1435px;height:auto\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center wp-block-paragraph\">See: Gold prices hold steady as seen on the <a href=\"https:\/\/vtmarketsapp.onelink.me\/CD7D\/240525WA\">VT Markets app<\/a>.<\/p>\n\n\n\n<h1 class=\"wp-block-heading has-medium-font-size\"><strong>Traders divided on future rate cuts, keeping gold in focus as a hedge<\/strong><\/h1>\n\n\n\n<p class=\"wp-block-paragraph\">Traders are split on the size of future cuts, with the CME FedWatch tool showing a 51% chance of another 50-basis-point reduction in November, while a 49% chance of a smaller 25-basis-point cut is also priced in. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The uncertainty surrounding interest rates keeps gold in focus as a hedge against fluctuating monetary policies.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\"><strong>Geopolitical tensions and lower rates boost gold\u2019s appeal as a safe haven<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">In a lower-rate environment, gold tends to shine, particularly as it offers a safe-haven investment during times of geopolitical strife. The ongoing conflict between Hezbollah and Israel has added another layer of risk to global markets. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The exchange of heavy fire over the weekend, with Hezbollah launching rockets deep into northern Israel, marks one of the largest escalations in nearly a year. This development could further drive gold prices higher if tensions escalate.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The upcoming release of PCE inflation data from the U.S. on Friday will also be closely watched by traders. Inflation figures could influence the Fed\u2019s next move, as inflationary pressures often lead to shifts in monetary policy. Should the data reflect stronger inflation, the Fed might slow down its easing efforts, which could limit further gains in gold.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In case you missed: <a href=\"https:\/\/www.vtmarkets.com\/analysis\/gold-steady-at-record-levels-on-central-bank-moves\/\">Gold steady at record levels on central bank moves<\/a><\/p>\n\n\n\n<h3 class=\"wp-block-heading has-medium-font-size\"><strong>Silver, platinum, and palladium decline amid weaker industrial demand<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Other precious metals have seen declines. Spot silver dipped by 0.2% to $31.06 per ounce, platinum dropped 0.8% to $967.81, and palladium fell 1.3% to $1,053.67 per ounce. These metals often follow gold\u2019s direction, but they can face additional pressure from industrial demand dynamics.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">With the<a href=\"https:\/\/x.com\/business\/status\/1836999141609672899\"> Bank of Japan keeping interest rates steady and signalling no rush to raise borrowing costs further<\/a>, gold could continue to benefit from the global low-rate environment. Traders should keep an eye on developments in the U.S. and Japan as monetary policies evolve, potentially driving further demand for gold as a safe asset.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">The BOJ holds rates, signaling no hurry for hikes <a href=\"https:\/\/t.co\/ZU4CAExjiW\">https:\/\/t.co\/ZU4CAExjiW<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/1836999141609672899?ref_src=twsrc%5Etfw\">September 20, 2024<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">This week\u2019s inflation data, along with geopolitical developments, will likely set the stage for the next phase in the gold market, with traders looking for confirmation on the direction of U.S. monetary policy and global risk factors.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Start trading now \u2014 click <\/strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/?utm_campaign=account_c&amp;utm_source=dma&amp;utm_medium=website\"><strong>here<\/strong><\/a><strong> to create your live VT Markets account.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Gold prices remained strong after the U.S. Federal Reserve cut rates by half a percentage point last week. With further rate cuts expected by the year\u2019s end, gold continues to attract demand, as lower interest rates typically boost the appeal of zero-yield assets like gold. -vtmarkets.com<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[27],"tags":[44,7],"class_list":["post-15083","post","type-post","status-publish","format-standard","hentry","category-analysis","tag-commodities","tag-gold"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15083","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/comments?post=15083"}],"version-history":[{"count":0,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/posts\/15083\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/media?parent=15083"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/categories?post=15083"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.global-vtrader.com\/en\/wp-json\/wp\/v2\/tags?post=15083"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}