Global gold prices hit new record highs on Monday morning ahead of the Christmas holidays.
The spot price of gold reached $4,409 per ounce, a rise of more than 1.50%. Meanwhile, gold futures reached $4,442 per ounce, a rise of more than 1.20%.
The moves come after a series of US data showing a decline in inflation, but the labor market continues to deteriorate with rising unemployment rates.
Japan triggers market turmoil
Japan’s top currency diplomat, Atsushi Mimura, warned that authorities would take appropriate action against excessive volatility in foreign exchange markets.
The yen has weakened steadily in recent weeks, amid growing concerns about Japan’s financial health and an escalating diplomatic row with China.
Last week’s interest rate hike and tough rhetoric from the Bank of Japan did little to halt the yen’s decline, with markets also disappointed by the lack of clear policy signals from the central bank.
OCBC analysts wrote in a note: Near-term risks may remain skewed to a weaker yen... The pace of Bank of Japan policy normalization remains slow and concerns about fiscal expansion are some of the factors that could weigh on the yen in the interim.
Stronger gold forecasts
Rich Ross, senior managing director and head of technical analysis at Evercore ISI, believes that market conditions are increasingly aligned with a strong extension of the bullish cycle, with the S&P 500 heading towards 7,000 by the end of 2025, 7,400 in early 2026 and possibly 8,000 later next year.
Gold Breakout : Gold/US Dollar is a key call to action, with Russ targeting 5,400 as technical momentum builds amid dollar weakness and lower yields.
Super cycle for silver : Ross is particularly optimistic about silver contracts, pointing to a breakout from a 45-year-old cup and handle formation and targeting 100.
