Gold Price Surges High Setting New Record
Gold price is sky rocketing, shattering all previous records. 2024 has set the bar high for the precious yellow metal. The price started off at $2,062.94 at beginning of 2024, and has now reached at a record rate of $2270 an ounce.
According to The Tokenist, there are three main factors driving the gold price to another level. The decline in the US Dollar Index (DXY) made gold more attractive to the investors. US dollar’s strength dipped slightly against foreign currencies, from a four-month high of 105.00 to 104.70.
The expectations of investors regarding the Federal Reserve’s monetary policy also believed to play a significant role in driving up the gold cost. The anticipation that the Fed is getting closer to cutting interest rates also added momentum to the price spike, which is also been driven by the visible geopolitical tension.
The optimism of investors on Federal Reserve cutting down interest partly comes from February’s core Personal Consumption Expenditure Price Index (PCE) figure, a primary inflation measurement used by the Fed, which recorded its lowest reading in two years, said media report. The data hinted that the Fed may cut down on interest and adopt a more accommodative policy stance.
The Israel-Palestine war and the geopolitical tension birthed from it, and the Russia-Ukraine war also played a key role in rally. There is also the case of strong buying from the central bank’s part, particularly in China, while the consumers have been loading up on the metal amidst the ongoing issues can also be considered as the key player in gold price hike.
The gold-buying trend is growing amongst Beijing’s young population. The demand for gold in China rose in recent quarters. The country’s central bank has added substantial volumes of bullion to its reserves, bolstering holdings in each of the past 16 months.
