Gold prices went up for the fifth day in a row on Thursday, reaching their highest level in over two weeks. This increase is due to growing hopes that the Federal Reserve will lower interest rates when they meet next week. A recent U.S. report showed that inflation matches expectations, reinforcing these hopes.
– The price of spot gold was around $2,719.79 per ounce, seeing a slight increase of about 0.1%. U.S. gold futures remained steady at $2,755.40 per ounce.
– In November, U.S. consumer prices saw their biggest increase in seven months, but this is not expected to stop the Federal Reserve from cutting interest rates for the third time next week, especially as the job market slows down.
– Traders believe there’s a 98.6% chance of a 25-basis-point cut during the Federal Reserve’s meeting on December 17-18.
– Attention now turns to the U.S. Producer Price Index data coming out at 1330 GMT, which will give more clues about the Fed’s future plans.
– The European Central Bank is also expected to cut interest rates soon and hint at more cuts in 2025, as inflation in the eurozone gets back to its target and the economy struggles.
– Gold is often seen as a safe investment during tough economic times and does well when interest rates are low.
– In other news, the United Nations General Assembly called for an immediate ceasefire between Israel and Hamas in the Gaza Strip and the release of all hostages.
– Citi analysts believe that gold and silver prices could gradually rise over the next 3-12 months, with gold potentially reaching $3,000 per ounce and silver hitting $36 per ounce.
– The SPDR Gold Trust, the largest gold-backed exchange-traded fund, reported a 0.30% increase in its holdings, climbing from 870.79 tonnes to 873.38 tonnes.
– Spot silver also increased by 0.1% to $31.94 per ounce, platinum rose by 0.4% to $943.10, and palladium went up by 0.5% to $986.25.
Key Events Coming Up (GMT):
– 1315: EU ECB Refinancing Rate
– 1315: EU ECB Deposit Rate
– 1330: U.S. Initial Jobless Claims
– 1330: U.S. PPI for Machine Manufacturing in November