Gold strengthened at the start of the Asian trading session as market participants grew more confident that the Federal Reserve would cut interest rates later this week. The price increase for this precious metal emerged after the release of key US inflation indicators, which were in line with expectations, providing no negative surprises for the market. This situation has led to gold being re-emerged as a safe-haven asset amidst the Fed's monetary policy shift.

ANZ Research, in a note, explained that the indicator in focus is the personal consumption expenditures (PCE) deflator, long known as the Fed's favorite measure of inflation. The PCE figure remained below 3% in September. This means that upward price pressures are considered relatively contained and have only increased moderately month-on-month. This data reinforces the view that room for the Fed to cut interest rates is beginning to open.

Amid this sentiment, the spot gold price rose around 0.2% to around $4,204.41 per troy ounce. Although the increase was not significant, this movement was seen as a signal that the market is beginning to position itself for a possible era of lower interest rates. For investors, this situation could be a catalyst for reconsidering gold as a hedge, especially if the Fed actually cuts interest rates and the US dollar begins to lose its strength. (az)

Source: Newsmaker.id