Gold prices today
Gold prices today are witnessing upward movements, with gold now trading above $5,200 per ounce, as the precious metal heads for weekly gains for the fourth consecutive week and the seventh consecutive month of gains.
Washington and Tehran are set to resume a new round of negotiations next week, after making progress during Thursday's meetings, although a US source indicated that some officials left the talks somewhat disappointed.
This discrepancy in statements has kept markets on edge and boosted hedging demand for gold.
Ahead of the Federal Reserve's
monetary policy decisions, investors are closely monitoring statements by Fed officials for clues about the path of interest rates.
Federal Reserve member Austin Goolsbee has indicated that interest rates could be cut if inflation continues to decline, while Governor Stephen Muran has expressed support for a cumulative cut of up to a full percentage point through 2026.
Expectations of interest rate cuts have a direct impact on gold prices, as falling yields enhance the appeal of the yellow metal, which does not generate a return.
Why does gold continue to rise?
Gold prices have recently hit record highs, driven by its use as a hedge against geopolitical and political risks.
However, buyers have become more sensitive to high prices, which explains the current volatility despite the overall upward trend.
Several key factors continue to support the positive trend for gold, most notably:
- Central banks continuing to diversify their reserves away from the dollar
- Escalating geopolitical tensions
- The prospect of future monetary policy easing
- Renewed inflows into gold-backed exchange-traded funds
- The impact of the tariffs recently imposed by US President Donald Trump
Overall, gold remains supported by a mix of political and economic factors, and with global uncertainty continuing, the prospects for a continued upward trend remain intact, especially if expectations of interest rate cuts are reinforced or geopolitical tensions escalate again.
