The price of Loco Gold surged to a new high of $3,791 per troy ounce, reinforcing the bullish trend in gold that has been developing since the beginning of the quarter. This increase was driven not only by global sentiment but also by domestic factors in the United States, further strengthening gold's prospects as a primary hedge.

Global Factors
1. Expectations of a Fed Interest Rate Cut

Global investors continue to anticipate further interest rate cuts from the Federal Reserve. Lower interest rates reduce the opportunity cost of holding gold, thus increasing investor interest in the precious metal.

2. Geopolitical Uncertainty

Conflicts in Eastern Europe and the Middle East, as well as escalating trade tensions between the US and China, have increased demand for safe-haven assets. This situation has added momentum to the gold rally.

3. Industrial Demand

Besides being investment assets, silver and gold are supported by the industrial sector, particularly renewable energy. This trend indirectly contributes to bullish sentiment in the precious metals market.

United States Domestic Factors
1. Weakening Economic Data

Jobless Claims showed an increase.

ISM Manufacturing & PMI were in the contraction zone.

Core PCE inflation fell, approaching the Fed's 2% target.
All of this reinforced market confidence that monetary easing was imminent.

2. Weakening US Dollar

The Dollar Index (DXY) came under pressure after the Fed's first interest rate cut this year. A weaker dollar made gold relatively cheaper for non-dollar global investors, driving up prices.

3. Declining Treasury Yields

The yield on the 10-year US Treasury bond fell significantly. This indicates investors are shifting from bonds to safe haven assets like gold.

Future Outlook

Technically, the bullish trend in gold remains dominant, with strong support at $3,750. The next psychological target is $3,800 per troy ounce. If the Fed signals a clearer dovish policy stance, gold's rally could potentially extend to higher levels.

Conclusion

Gold's rally to $3,791 is the result of a combination of global and domestic US factors. From geopolitical uncertainty to a weakening US economy, all of these factors strengthen gold's position as a primary hedge. For investors, this momentum presents a strategic opportunity to capitalize on the ongoing bullish trend.

Source: Newsmaker.id