Global gold prices witnessed a slight rise in trading on Tuesday, as investors took a cautious stance awaiting important US economic data. This data may provide decisive signals about the path of interest rates that the US Federal Reserve may follow in the coming period.
The market is looking forward to a group of economic reports that may significantly affect the direction of the markets. These data include the number of job openings, which is scheduled to be issued later today, in addition to the employment report from ADP scheduled for Wednesday.
and the non-farm payrolls report that will be issued on Friday from the US Department of Labor.
In this context, the financial market analyst stated that the focus will be on the jobs report that will be issued on Friday. He said that “the upcoming report will be pivotal in determining whether the Federal Reserve will decide to cut interest rates at the next meeting or not.”
Christopher Waller, a member of the Federal Reserve Board, also indicated in his statements on Monday that expectations indicate that inflation will continue to decline towards the 2% level.
which makes him currently inclined to support another interest rate cut at the next meeting of the central bank.
This trend comes at a sensitive time for financial markets.
as any changes in monetary policy could significantly impact gold price movements. Gold typically reacts to expectations of interest rate cuts, tending to rise as a result of lower yields on bonds and other investment vehicles.
As such, analysts expect the upcoming non-farm payrolls report on Friday to be the decisive factor in market movements. If the data shows weakness in the labor market, pressure could increase on the Federal Reserve to cut interest rates to support the economy
Remarks Boost Rate Cut Expectations: Gold Waits for New Catalyst
Recent comments on the US economy have reinforced expectations that the Federal Reserve will cut interest rates at its upcoming meeting on December 17 and 18. Expectations indicate a high probability of a 25 basis point cut, with the probability of such a cut reaching around 75%.
According to the head of global macroeconomics, “gold seems to be in a state of fluctuation at the moment, waiting for a new stimulus.” He added that a 25 basis point rate cut this month seems very likely. This expectation has been heavily priced into financial markets, meaning that the expected impact of this cut has already been taken into account.
However, the most important question for markets remains the extent of future changes in interest rates policy in 2025. This question is highly anticipated, as analysts expect new changes in interest rates during the coming year.
which could significantly impact financial markets and gold prices.
Gold is considered one of the assets that usually thrive in a low interest rate environment. In this environment, many investors prefer to turn to gold as a safe haven.
especially during times of low yields on bonds and other financial instruments. In addition, gold thrives particularly during times of geopolitical turmoil, as investors turn to safe-haven assets amid global tensions.
Therefore, analysts point out that gold’s movements in the coming period will largely depend on the outcome of monetary policy in the United States. If interest rates are indeed cut in December, gold may witness further increases. However, geopolitical tensions will remain an important factor influencing gold trends.
as demand for it increases as a safe haven during global crises.
Investors are also closely watching any new economic indicators that may affect the Federal Reserve’s decisions. Jobs reports, inflation data.
Gold prices decline after Trump’s threats: Dollar and yields affect the market
Gold prices witnessed a slight decline during Monday’s trading, affected by the rise in US Treasury yields and the rise of the dollar. This decline came after President-elect Donald Trump threatened to impose tariffs on the BRICS countries.
which increased concerns about inflation in the United States. These developments led to increased pressure on gold prices. This decline came after a period of relative stability, reflecting gold’s sensitivity to economic changes.
Gold and the Dollar Now
Despite the decline witnessed by gold on Monday, spot gold contracts witnessed a slight increase of 0.3%, reaching $ 2,647 per ounce. At the same time, gold futures rose by 0.4% to record $ 2,669 per ounce. This rise reflects gold’s ability to partially recover from previous losses.
On the other hand, the US dollar index stabilized at 106.42 points, reflecting the strength of the dollar against other currencies. This stability in the dollar still indirectly affects gold prices.
as gold tends to decline when the dollar rises, and vice versa.
Moves in other metals
While gold saw mixed moves, spot silver added 0.2% to $30.55 an ounce. This suggests that silver has benefited from some positive market sentiment, despite the general pressure on precious metals. In contrast, platinum fell 0.4% to $942.80 an ounce, while palladium fell 0.6% to $975.74 an ounce. These declines in other metals show a mixed performance in markets due to global economic factors.
Future Impact on Gold
Financial markets are currently on tenterhooks following Trump’s recent comments. These statements could have a significant impact on gold prices, especially if trade measures against the BRICS countries are implemented. This policy could lead to increased inflationary concerns in the United States.
which could contribute to a rise in gold prices as a safe haven.
