2660 USD once again buyers zone on demand back
Gold bounced back at the end of the week after US inflation data (PCE) came in lower than expected. This data suggests that the Federal Reserve will likely continue with its easier monetary policy, which is good for gold. However, gold's price fell earlier due to the possibility of fewer interest rate cuts and a stronger US dollar, both of which are negative for gold.
By Friday, gold prices recovered, trading around $2,660 per ounce after the inflation report missed expectations. The lower inflation numbers indicate that the Fed might keep lowering interest rates, which benefits gold since it doesn’t pay interest itself.
In August, the US Core Personal Consumption Expenditures (PCE) rose by 0.1%, which was lower than the expected 0.2%. Year-over-year, the Core PCE increased by 2.7%, slightly up from 2.6% in July.
Before the data was released, gold had been dropping because Chinese government stimulus effects were fading, and global central banks were becoming less likely to ease monetary policies. After hitting new record highs, gold leveled off. The impact of China’s 1 trillion CNY stimulus seemed to be priced in, and central banks like Sri Lanka, Switzerland, and Mexico only made minor rate cuts. In India, rate cuts are expected to be modest.
Additionally, recent positive US economic data, like lower jobless claims and solid GDP growth, has reduced expectations of a large interest rate cut by the Fed in November. The chance of a 50 basis points (bps) cut fell from over 60% to 50%. Meanwhile, geopolitical tensions in the Middle East, particularly between Israel and Hezbollah, remain high, but they have not escalated into a larger conflict yet.
Technically, after hitting an all-time high of $2,685, gold pulled back but remains in an overall uptrend across short, medium, and long-term periods. This suggests that gold prices may continue to rise, as trends in technical analysis often point to further gains.
By Friday, gold prices recovered, trading around $2,660 per ounce after the inflation report missed expectations. The lower inflation numbers indicate that the Fed might keep lowering interest rates, which benefits gold since it doesn’t pay interest itself.
In August, the US Core Personal Consumption Expenditures (PCE) rose by 0.1%, which was lower than the expected 0.2%. Year-over-year, the Core PCE increased by 2.7%, slightly up from 2.6% in July.
Before the data was released, gold had been dropping because Chinese government stimulus effects were fading, and global central banks were becoming less likely to ease monetary policies. After hitting new record highs, gold leveled off. The impact of China’s 1 trillion CNY stimulus seemed to be priced in, and central banks like Sri Lanka, Switzerland, and Mexico only made minor rate cuts. In India, rate cuts are expected to be modest.
Additionally, recent positive US economic data, like lower jobless claims and solid GDP growth, has reduced expectations of a large interest rate cut by the Fed in November. The chance of a 50 basis points (bps) cut fell from over 60% to 50%. Meanwhile, geopolitical tensions in the Middle East, particularly between Israel and Hezbollah, remain high, but they have not escalated into a larger conflict yet.
Technically, after hitting an all-time high of $2,685, gold pulled back but remains in an overall uptrend across short, medium, and long-term periods. This suggests that gold prices may continue to rise, as trends in technical analysis often point to further gains.
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