Gold Price Update: Record Levels Amid Continuing Interest Rate Cuts

Gold surged to a record high early Monday, marking its fifth consecutive day of increases. This rally follows the Federal Reserve’s first interest rate cut in four years last week, with indications of more reductions to come. December gold futures rose by $5.70 to $2,651.90 per ounce, slightly surpassing Friday’s record close of $2,646.20.

The Fed’s policy committee reduced its benchmark interest rate by 50 basis points on Wednesday, signaling an additional 50-point cut by year-end. This commitment to lower rates diminishes the cost of holding gold, boosting interest from institutional investors.

Monday’s milestone reflects a “continuation of the ‘fear of missing out’ trend that has followed the significant U.S. rate cuts last week.” The market seems to require consolidation, but a substantial pullback is necessary to unsettle hedge funds holding the largest bets on rising prices since 2020, according to Saxo Bank.

In early trading, the dollar gained ground, with the ICE dollar index rising 0.16 points to 100.89.

Treasury yields displayed mixed results. The two-year U.S. note was last reported at 3.612%, down 0.2 basis points, while the yield on the 10-year note increased by 2.5 basis points to 3.769%.

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