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Key Points
Spot gold prices rose by 0.1% to $2,696.82 per ounce as of 0023 GMT, while U.S. gold futures increased 0.3% to $2,726.00. The move came ahead of U.S. Consumer Price Index (CPI) data, shaping market expectations for Federal Reserve actions in 2024.
Traders are urged to keep an eye on the upcoming Producer Price Index (PPI) data set for release on Thursday.
Current forecasts suggest that the Fed will cut interest rates by 25 basis points on 18 December, with 86% of traders backing this scenario according to the CME FedWatch tool.
Rising tensions in the Middle East add further support for gold. The Israeli military reported strikes on key strategic targets in Syria, escalating concerns over regional stability.
Picture: Gold climbs steadily, with moving averages and MACD pointing to ongoing upward momentum, as seen on the VT Markets app.
The charts indicate the steady movement of gold over the last trading session, closing around 2700.20 and moving upward, displaying a steady climb from its opening near 2660.86.
The price rose towards a high of 2704.42 and found only mild pullbacks along the way, reflecting an ongoing bullish bias on the short-term chart.
Gold is traditionally viewed as a safe haven during periods of economic and geopolitical uncertainty and typically performs well in a low-interest-rate environment.
Central bank demand, ongoing monetary policy easing, and global political turmoil have propelled gold prices upward by 31%, positioning it for its best annual performance since 2010.
Goldman Sachs reiterated its bullish outlook for gold on Tuesday, defending the possibility of prices reaching $3,000 per ounce by the end of 2025, even in a scenario where the U.S. dollar remains relatively strong.
Silver prices also experienced a modest rise, climbing 0.1% to $31.93 per ounce. Platinum held steady at $943.15, while palladium rose 0.4% to $971.44.
Given the strong momentum in gold and expectations for further monetary easing, we anticipate further gains in the near term.
However, key inflation reports could prompt price volatility, and traders will be looking closely for alignment between inflationary trends and Federal Reserve policy forecasts.
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