Gold Prices Rise During Today’s Trading: What Are the Reasons?

Gold prices rose significantly at the start of trading on Tuesday, reaching $4,619 per ounce, before retreating to trade near $4,560. However, the precious metal remains high for the third consecutive day.

It appears that gold has found strong support around the $4,100 level, benefiting from a return in demand following the recent downturn.

Gold benefits from rising inflation fears

The rise in gold prices was supported by increased demand from investors who took advantage of the price decline, particularly as concerns about global inflation persist.

Gold is traditionally viewed as a safe haven in times of economic uncertainty, which enhances its appeal under current conditions.

Developments in the Iran conflict support the markets

Geopolitical tensions play a pivotal role in gold’s movements, as media reports indicated that U.S. President Donald Trump is considering ending the military campaign against Iran, even if the Strait of Hormuz remains partially closed.

These statements helped ease some concerns but kept markets in a state of anticipation.

Jerome Powell’s Remarks and Their Impact on Gold

Federal Reserve Chair Jerome Powell stated yesterday, Monday, that disruptions in the energy sector are often short-lived, but he cautioned against underestimating their impact, especially after years of high inflation.

These remarks reflect the central bank’s caution in addressing economic developments, which directly influences investor sentiment toward gold.

Markets Await U.S. Labor Market Data

Traders are awaiting the release of U.S. labor market data this week, which could provide strong signals regarding the future of U.S. monetary policy.

Positive Outlook from Goldman Sachs

Goldman Sachs indicated its expectation that gold prices will reach $5,400 per ounce by the end of 2026, supported by several factors, most notably:

- The likelihood of interest rate cuts by the Federal Reserve

- Continued strong demand from central banks

- Declining levels of market speculation

The bank expects central banks to increase their gold purchases to an average of 60 tons per month, which could bolster demand in the medium term.

Is Gold in Oversold Territory?

Many analysts believe that gold is currently trading near oversold territory, due to reduced speculative activity, as well as markets pricing in more hawkish political scenarios compared to historical precedents, which could pave the way for a new rally.

Outlook for Gold Prices

Given these factors, gold prices are expected to remain supported by several key factors, including:

• U.S. monetary policy trends
• Geopolitical developments
• Macroeconomic data, particularly the labor market
• The volume of central bank purchases

Accordingly, gold may see strong movements in the coming period, with the possibility of the uptrend continuing in the medium term.