Gold Stabilizes with Second Weekly Gains Amid Weakening Dollar

Gold continues to achieve gains for the second consecutive week, as prices stabilized on Friday, supported by the decline in the US dollar. Reports indicate growing market confidence that the Federal Reserve has concluded its interest rate hikes.

Topic

the details

The most important expectations

the details

At 0205 GMT, gold prices in spot transactions remained at $1992.46 per ounce, marking a 0.7% increase for the week.
Futures contracts for gold showed little change, recording $1993.40.

Tim Wotter, senior market analyst at K.C.M. Trade,
noted that “the dominant themes in the financial markets over the past week were declining yields and a weaker US dollar, contributing to the rise in gold prices.”

In this context, the dollar index fell by 0.2% against its counterparts,
heading for its second weekly decline, making gold more attractive to holders of other currencies.

With the yield on 10-year US Treasury bonds rising to 4.4568%,
markets lowered their expectations for interest rate cuts in 2024.
This followed data showing a larger-than-expected decline in new unemployment benefit claims in the US last week.

The most important expectations

However, strong job data did not change expectations for a slowdown in the US labor market amid rising interest rates. Fiduciary, a C.M.E. Group subsidiary, expects the Federal Reserve to leave interest rates unchanged in December, with a roughly 26% chance of a rate cut in March.

A potential interest rate cut is expected to reduce the alternative opportunity cost of holding gold.
Regarding other precious metals, silver rose to $23.69 per ounce,
while palladium increased to $1049.55, and platinum remained at $915.57,
heading for its second consecutive weekly gain.

Gold Stabilizes with Second Weekly Gains Amid Weakening Dollar

Gold Stabilizes with Second Weekly Gains Amid Weakening Dollar

Related Topics