Gold dipped on Tuesday, 27 August, with spot gold down 0.4% at $2,507.96 per ounce. The precious metal has seen a rise of over 21.5% this year, hitting a record high of $2,531.60 per ounce on 20 August.
Gold futures in the US fell 0.5% to $2,543.20. Yeap Jun Rong, market strategist at IG, commented that while a US interest rate cut in September is almost certain, investors are holding back due to debates around the extent of the cut, awaiting forthcoming economic data.
“We expect the upward trend for gold to persist, especially when considering gold’s positive performance during past Fed easing cycles, healthy central bank demand, and its role as a geopolitical and economic risk hedge,” said Yeap Jun Rong.
Gold prices are experiencing a downward trend.
According to CME’s FedWatch tool, traders see a 70% chance of a 25-basis point rate cut and about a 30% chance of a larger 50-basis point reduction. Low-interest rates tend to boost the appeal of non-yielding bullion.
Among other metals, silver gained 0.1% to $29.93 per ounce, platinum fell 0.5% to $957.55, and palladium rose 0.1% to $959.90.
The US dollar and Japanese yen also weakened. The impending US interest rate cut is a key focus for investors, putting pressure on the greenback. The yen fell 0.1% to 144.65 yen per dollar, after touching a three-week high of 143.45 in the previous session. The euro and pound sterling rose about 0.1% to $1.1172 and $1.3201, respectively, hovering near multi-month highs.
Rodrigo Catril, a senior FX strategist at National Australia Bank, said: “The market is taking a bit of a pause and waiting for some key data to come out.”
Most currencies are at record highs, and the US dollar is near its lowest in over a year, fueled by expectations of a September rate cut. This likelihood was further cemented by Fed Chair Jerome Powell’s speech at Jackson Hole. David Chao, Asia-Pacific (ex-Japan) global market strategist at Invesco, commented: “The question now is not whether the Fed will cut in September, but by how much. Powell left the door open for a larger cut if labor conditions deteriorate. Investors believe the Fed seems prepared to cut rates faster than previously expected.”
Market Update on February 2nd: Oil, Copper, Iron & Steel, Rubber, and Sugar Prices Decline, Gold Surges to Almost 1-Month High.
At the end of the trading session on February 1st, the prices of oil, copper, iron and steel, rubber, and sugar all dropped, while natural gas hit a nine-month low and gold reached its highest point in nearly a month.
Market Update on February 3rd: Crude oil, gold, copper, iron and steel, and rubber all decline together.
At the close of trading on February 2nd, the prices of oil, gold, copper, steel, rubber, and coffee all saw a simultaneous decrease, with iron ore hitting a two-week low.
Weekend Ending Sees Significant Gold SJC Price Drop
After surging to nearly 79 million dong per tael on February 2nd, the price of SJC gold is now plummeting towards the 78 million dong per tael mark this weekend.
