Prospects of Interest Rate Cuts Push Gold Prices Higher
Gold prices moved steadily during the Asian session on Thursday, hovering around $3,378. Gold prices are likely to rise further as the Federal Reserve's stance becomes increasingly dovish. Several factors have boosted positive sentiment toward gold, including the possibility of President Donald Trump appointing a Fed chair who supports interest rate cuts, as well as increased central bank gold purchases and inflows into gold-backed exchange-traded funds (ETFs).
Over the past few days, three Fed officials, Mary Daly, Lisa Cook, and Neel Kashkari, have voiced concerns about the state of the US labor market. These comments further strengthen the case for a rate cut at the upcoming September meeting.
Later this week, two other key officials, Atlanta Fed President Raphael Bostic and St. Louis Fed President Alberto Musalem, are also scheduled to provide their views. Musalem, who has voting rights this year, is considered to have significant influence on the future direction of monetary policy.
With increasing signs of economic weakness, market participants are beginning to believe that the Fed is ready to cut interest rates again after a long pause. This situation is very supportive for gold, which has now risen 29% year-to-date and is one of the best-performing commodities so far. (ayu)
Source: Newsmaker.id
