Gold prices rise above USD2,500 amid expectations of interest rate cuts by Federal Reserve
Date
8/18/2024 5:46:12 AM
(MENAFN) The price of Gold in spot transactions has surged past the USD2,500 per ounce mark for the first time ever, driven by growing expectations that the U.S. Federal Reserve will soon reduce interest rates. On Friday, spot gold reached a record high of USD2,500.16 per ounce, surpassing the previous peak set last month. This unprecedented spike in gold prices reflects heightened market optimism about imminent changes in U.S. monetary policy.
The recent surge in gold prices was fueled by a disappointing report on the U.S. housing market, which has bolstered anticipations of more significant and rapid cuts in U.S. interest rates. Investors are increasingly betting that the Federal Reserve will act decisively to address economic challenges, leading to a favorable environment for gold. Lower interest rates typically enhance gold's appeal, as the metal does not yield any interest income, making it more attractive in a low-rate environment.
Gold’s impressive climb underscores its role as a safe-haven asset amidst economic uncertainties and shifting monetary policies. The expectation of reduced interest rates, which generally benefits non-yielding assets like gold, has spurred significant buying interest, pushing gold to historic highs. This move highlights the ongoing market sentiment that monetary policy adjustments could further influence gold's value in the near future.
MENAFN18082024000045015682ID1108572179
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.