Gold is experiencing upward momentum, holding steady above $5,000 per ounce, driven by a weaker US dollar and expectations of potential Federal Reserve rate cuts. Market sentiment is being influenced by upcoming US economic data releases, continued gold purchases by China’s central bank, and easing tensions in the Middle East. However, positive sentiment in equity markets is acting as a headwind, limiting gold’s gains as a safe-haven asset.
- Gold rose past $5,000 per ounce, the highest in over a week.
- A weaker US dollar is supporting gold prices.
- The market is awaiting key US economic data, including the jobs report and inflation figures.
- San Francisco Fed President Mary Daly suggested potential rate cuts to support the labor market.
- China’s central bank extended gold purchases for the 15th consecutive month.
- Easing tensions between the US and Iran are being monitored.
- Dovish US Fed expectations and concerns about the central bank’s independence are weighing on the US Dollar.
- Positive equity market sentiment acts as a headwind for gold.
- The Nonfarm Payrolls (NFP) report and US consumer inflation figures are upcoming catalysts.
- Gold holdings in China continue to increase.
- There are suggestions that the Fed may lower borrowing costs multiple times in 2026.
- The possibility of criminal investigation of Kevin Warsh if he ends up refusing to cut interest rates, fueling concerns about the central bank’s independence.
The current environment suggests a cautiously optimistic outlook for gold. Demand from central banks, particularly China, combined with a potentially more accommodative monetary policy in the US, could provide continued support. However, improved risk appetite in the broader market may limit the upside potential for the precious metal. Upcoming economic indicators will be crucial in determining future price movements.