MLS Football Jersey

Gold price resilient despite Fed’s firm stance; Middle East tensions provide support

Despite the US Federal Reserve’s pledge to maintain a high interest rate regime, the price of gold rose by 0.75 per cent this week, with the Multi Commodity Exchange (MCX) futures contract due February 2024 closing at £63,200 per 10 grams, up £1,250 from the previous week’s close. Internationally, gold closed at $2,039 per ounce, a weekly gain of over $21 per ounce.

Gold price resilient despite Fed’s firm stance; Middle East tensions provide support

Commodity market experts attribute gold’s resilience to tensions in the Middle East, which have fuelled safe-haven demand for the precious metal. While hopes of a March 2024 rate cut have faded, the ongoing crisis in the Red Sea region has supported gold prices. However, the recent strengthening of the US dollar, fuelled by strong US jobs data, has dampened the gold rush.

Analysts highlighted that the MCX gold exchange rate faces resistance at the £63,200 level, with key support at £61,500.

Factors driving the rally in gold prices

Anuj Gupta, Head of Commodities & Currencies at HDFC Securities, explained that the surge in gold prices, despite lower expectations of a rate cut in March 2024, was due to geopolitical concerns in the Middle East. The crisis in the Red Sea region has fuelled safe-haven demand for gold. However, towards the end of the week, gold gave back some of its gains as the US dollar strengthened and Treasury yields rose on strong US jobs data.

Sugandha Sachdeva, founder of WealthWave Insights, emphasised that the strong payroll growth data overshadowed the prospect of a potential interest rate cut, which led to the reversal in gold prices.

Gold Price Outlook

Sugandha Sachdeva provided insights into the near-term gold price outlook, suggesting that gold may have formed a bottom near $61,500 per 10 grams or $2,000 per ounce. However, she notes that the level of £63,200 per 10 grams remains a resistance point. A sustained break above this level could signal upward momentum for gold, which could target higher levels around $63,800 per 10 grams of gold or $2,080 per ounce.

Leave a Reply

Your email address will not be published. Required fields are marked *

Previous post Air Jordan 4 Retro BG Teal: The Modern Style Sneaker
Next post Word feestelijk met de klassieke Nike Dunk Low Light Iron Ore!
MLS Football Jersey