Gold nears record, set for weekly gains

FE Team | Published: September 20, 2024 21:52:30

Gold hovered near record levels on Friday and was on track for a weekly gain after the U.S. Federal Reserve's recent oversized interest rate reduction and on signs that further cuts were on the horizon, reports Reuters.
Spot gold rose 0.3 per cent to $2,593.79 per ounce, as of 0539 GMT, up about 0.7 per cent for the week so far.
Bullion rose to a record high of $2,599.92 on Wednesday after the Fed began its easing cycle with a half-percentage-point cut. The Fed also projected a further half-point reduction by year-end, a full point next year and an additional half-point trim in 2026.
US gold futures edged up 0.2 per cent to $2,618.70.
"Current trends are very positive for gold, and if these favourable market conditions continue, prices could reach between $2,600 and $2,800 over the next 12 months," said Kyle Rodda, a financial market analyst at Capital.com.
Lower U.S. interest rates and geopolitical uncertainty increase the bullion's appeal.
In the Middle East, Israeli warplanes late on Thursday carried out their most intense strikes on southern Lebanon in nearly a year of war, heightening the conflict between Israel and Lebanese armed group Hezbollah.
"Gold prices are expected to be well-supported in the coming months due to a weaker U.S. dollar and lower bond yields, as well as against a backdrop of elevated geopolitical tensions," BMI said in a note.
Elsewhere, China refrained from importing gold from Switzerland for the first time since January 2021 in August, customs data from the world's biggest bullion consuming, refining and transit hub showed on Thursday.
Spot silver rose 0.8 per cent to $31.03 per ounce and palladium was trading flat at $1,080.25 per ounce.
Platinum shed 0.2 per cent to $986.95 and was down about 0.8 per cent so far this week.