Gold prices jumped 2% on Thursday (December 30th), driven by a weaker dollar following the Fed's interest rate cut and as investors remained uncertain about the outcome of a trade deal between the presidents of the world's two largest economies.
Spot gold prices rose 1.9% to $4,004.75 per ounce at 09:18 GMT. US gold futures for December delivery fell 0.4% to $4,018.30 per ounce.
"Gold prices appear to be strengthening as investors digest the outcome of the Trump-Xi meeting and the Fed's decision to cut interest rates for the second time this year," said Lukman Otunuga, senior research analyst at FXTM.
The US central bank cut its benchmark interest rate by 25 basis points on Wednesday, bringing its overnight benchmark interest rate to its target range of 3.75%–4.00%. "Regarding monetary policy, traders still price in a 70% probability of a December interest rate cut, even though Powell has sought to cool expectations around further rate cuts," he added.
Fed Chairman Jerome Powell said officials are struggling to reach a consensus on what monetary policy will entail and warned that the market should not assume another rate cut in December. Non-yielding gold thrives in low-interest rates and during times of economic uncertainty.
Meanwhile, US President Donald Trump said he had reached a deal to lower tariffs on China in exchange for Beijing resuming purchases of US soybeans, maintaining the flow of rare earth exports, and cracking down on illicit fentanyl trade.
China itself agreed to delay implementing the latest round of rare earth export controls, but previous restrictions on critical minerals that have disrupted global trade remain in place.
Trump's remarks came after face-to-face talks with Xi in Busan, South Korea, marking the end of his brief trip to Asia, during which he also praised trade breakthroughs with South Korea, Japan, and Southeast Asian nations.
Elsewhere, spot silver rose 1.4% to $48.22 per ounce, platinum rose 2% to $1,616.20, and palladium rose 2.9% to $1,441.24. (alg)
Source: Reuters
Gold prices weakened slightly on Thursday (February 12th), as more solid US employment data reduced market confidence in an imminent Federal Reserve interest rate cut. The strong employment data promp...
Gold prices strengthened on Wednesday, supported by a weaker US dollar and falling US bond yields after the latest economic data reinforced the narrative that the Federal Reserve is likely to continue...
Gold experienced a slight correction in the European session on Tuesday (February 10th), but remained above $5,000/oz as the market held its breath ahead of a series of US data that could alter intere...
Gold held above the psychological $5,000 level at the start of the week, supported by a combination of factors that are "right" for the precious metal : physical demand from China, expectations of low...
Gold prices are still struggling to turn an intraday rebound into a sustained rally. After briefly falling to $4,654 (a four day low) and rebounding, prices were again rejected near $4,900. In the Eur...
Oil prices stabilized on Thursday (February 12th), as the market reassigned a risk premium to US-Iran tensions despite US inventory data showing swelling domestic supplies. This movement confirms one thing: geopolitical headlines are still more...
Gold prices weakened slightly on Thursday (February 12th), as more solid US employment data reduced market confidence in an imminent Federal Reserve interest rate cut. The strong employment data prompted market participants to shift expectations of...
The Hang Seng Index reversed its downward trend in Hong Kong on Thursday (February 12th), weakening by around 0.9% to around 27,000 after a strong session earlier. This decline halted the momentum of the short term rally, as investors began to...