Global gold prices rose during these moments of trading on Thursday, to be traded not far from the record high level it recorded in the previous session, as increasing expectations of a cut in US interest rates in September led to an increase in demand for non-yielding bullion.
Ryan McIntyre, senior portfolio manager at Sprott Asset Management, said lower interest rates and the US election are two immediate factors likely to push gold above $2,500, as gold tends to benefit from economic and geopolitical uncertainty.
“Gold holdings in exchange-traded funds appear to have bottomed out in May and are now starting to increase again,” McIntyre added. “There could be a new wave of demand for gold coming through these funds.”
Lower interest rates make non-yielding bullion more attractive.
Markets are expecting a 25 basis point cut at the Federal Reserve’s September meeting, according to the US interest rate tracker available on Investing Saudi Arabia.
A Federal Reserve survey showed that U.S. economic activity expanded at a slight to modest pace from late May through early July, with businesses expecting slower growth ahead.
Gold at settlement yesterday
Gold futures prices erased their gains during trading on Wednesday, with profit-taking operations to benefit from the yellow metal recording record levels.
At settlement, gold futures for August delivery fell 0.3%, or $7.9, to $2,459.90 an ounce, after touching $2,488.40.
Gold and dollar now
Gold futures are now up 0.5% at $2,473 an ounce.
Spot gold futures rose 0.4% to $2,469 an ounce. Prices hit an all-time high of $2,483.60 on Wednesday.
On the other hand, the dollar index stabilizes at 103.462 points.
Other minerals
Spot silver rose 0.4% to $30.40, platinum rose 0.6% to $1,000 and palladium gained 0.6% to $957.31.
