Gold Nears Record Highs on U.S. Data

October 17, 2024

Key Points

• Gold flirts with $2,700 as traders brace for weak U.S. retail data.
• Platinum gains 1.2%, silver edges up by 0.4%.

Gold prices edged 0.3% higher on Thursday, reaching $2,682.14 per ounce as of 0221 GMT.

Earlier in the week, gold touched a session high of $2,685.16, just below its all-time peak of $2,685.42 reached on 26 September. U.S. gold futures also saw a slight increase, up by 0.2% to $2,697.40.

See: Gold is trending upward, approaching resistance near 2680, with bullish momentum supported by rising moving averages on the VT Markets app.

Investors Turn to Gold as U.S. Election Uncertainty Boosts Safe-Haven Appeal

Investors are flocking to gold as they seek safety amid growing uncertainty around the upcoming U.S. elections.

Analysts have pointed out that a Trump presidency could raise trade tensions and expand the budget deficit, further supporting the precious metal’s rally.

In the short term, analysts suggest gold may encounter resistance at the $2,700 mark.

Market participants are keeping a close eye on U.S. retail sales and industrial production data due later today. Weekly jobless claims data will also be released, which could influence market sentiment.

Analysts have speculated that if the retail sales data comes in weaker than expected, it may provide the catalyst for another upward move in gold prices.

See also: Gold Steady as Traders Eye Fed Rate Outlook

Markets Brace for Rate Cuts as Central Banks Signal Easing

Traders are pricing in a 92% chance of a 25-basis-point rate cut by the Federal Reserve next month, as indicated by the CME FedWatch tool.

Similarly, the European Central Bank (ECB) is expected to cut rates for the second consecutive time as inflation appears increasingly under control in the eurozone.

Meanwhile, British inflation slowed sharply last month, reinforcing market expectations of a rate cut from the Bank of England.

Geopolitical concerns continue to support gold’s safe-haven appeal, as tensions escalate in the Middle East.

An Israeli airstrike in south Lebanon killed 16 people, including a mayor, after hitting a municipal building.

In the broader metals market, platinum saw a strong gain of 1.2%, rising to $1,005.00 per ounce, while silver edged up 0.4% to $31.79 per ounce.

Palladium also firmed, up by 0.5% to $1,028.72 per ounce, reflecting positive sentiment across precious metals in the wake of uncertain global developments.

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