Gold strengthens as markets price in December Fed rate cut and Dollar slips
Gold (XAU/USD) kicks off the new month on a firm footing, climbing to its highest level since October 21 on Monday, as risk-off sentiment underpins safe-haven demand, while traders gear up for another interest rate cut by the Federal Reserve (Fed) at its December 9-10 monetary policy meeting.
At the time of writing, XAU/USD is trading around $4,260, putting the metal on track for its best annual performance since 1979. Prices are up nearly 60% so far this year, supported by strong central bank demand, robust ETF inflows, persistent geopolitical tensions and the prospect of lower interest rates in the United States (US).
Investors now turn their attention to key US economic data releases this week, which could influence interest rate cut expectations. Markets are already pricing in around an 87% probability of a 25-basis-point (bps) reduction at next week’s meeting, following dovish-leaning remarks from several policymakers and softer US data last week.
Source : Fxstreet.com