Gold prices rose, coming within sight of fresh peaks, amid growing hopes that the Federal Reserve will begin cutting rates from September. Bloomberg writes about this.
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Price growth
The price of spot gold rose by 0.2% to $2,427.77 per ounce, gold futures expiring in August rose by 0.1% to $2,432.30 per ounce.
Spot prices are now less than $30 behind the record high $2,450, reached in late May.
Reasons
The recent rise in prices for the yellow metal was driven mainly by growing hopes that the Fed will begin cutting rates by September, following weak inflation data and several dovish signals from the U.S. central bank.
Fed Chairman Jerome Powell said on Monday that the bank has become confident that inflation is falling. While he stopped short of directly communicating a rate cut, the market took his comments as a signal that a rate cut was imminent.
Traders were seen completely ignoring expectations that the Fed would keep rates unchanged in September, and are now pricing the chance of a 25 basis point rate cut at nearly 90%, according to the CME Fedwatch tool.
- Investments Gold
