Friday 29/November/2024 – 02:01 PM
Price rose gold The global trend during trading today, Friday, found support from the decline in the levels of the US dollar, in addition to geopolitical tensions. Despite this, gold recorded the largest monthly decline during November in more than a year.
Gold Billion: Global gold recovery due to falling dollar levels
The price of an ounce of global gold rose today by 0.9%, reaching the highest level in 5 sessions at $2666 per ounce, after opening today’s trading at $2639 per ounce, according to Gold Billion’s technical analysis.
Despite the recovery in gold prices, it is on its way to recording a weekly decline so far by 2%, and today concludes the trading month of November, which witnessed a decline in the global price of gold by 3%, to remain the largest monthly decline in 14 months, and it had recorded the lowest level during November at $2,536 per ounce, the lowest level in two months.
The recovery witnessed by the price of gold today was supported by the decline in the levels of the US dollar against a basket of major currencies, recording a decline of 0.2%, recording the lowest level in two weeks, and thus this worked to support gold prices in light of the inverse relationship that links them.
Gold is heading for a weekly decline of up to 2%
The escalation of geopolitical tensions also contributed to the return of gold to its rise as a safe haven, as there are mutual accusations between the Zionist entity and Hezbollah of violating the truce and ceasefire, in addition to Russia launching its second largest attack on the infrastructure in Ukraine, which threatens the continuation of global geopolitical tensions.
These factors helped gold reduce its losses recorded at the beginning of this week, but the losses recorded by gold since the beginning of the month remain prevalent, because they were the result of the victory of presidential candidate Donald Trump for a new presidential term and the resulting many new legislation and policies that increase the strength of gold. The dollar and high inflation.
So far, the financial markets expect interest rates to be lowered by the US Federal Reserve next December by 25 basis points, and they place a probability of 68% and another probability of 32% that the bank will hold interest rates unchanged.
In general, uncertainty currently prevails regarding the future of the Federal Reserve’s monetary policy and the path of interest rates, especially after Trump’s threat earlier this week to impose new customs tariffs on China at a rate of 10% and on both Mexico and Canada at a rate of 25%, which would support a rise in tariffs. The dollar and inflation rates in a way that may limit the Federal Bank’s ability to continue reducing interest rates.
Expectations indicate that the US Federal Reserve may lower interest rates at its next meeting in December before starting a pause, and that 2025 will witness great volatility due to the financial policies of the new US administration, during which the Federal Reserve will follow a very cautious approach in dealing with monetary policy.
Gold finds support from the policy of monetary easing and the Fed’s continued reduction of interest rates, because this reduces the opportunity cost of gold, which does not provide a return to its holders. If inflation returns to rise due to Trump’s policies and the Fed’s slowness in reducing interest rates, this will have a major negative impact. On global gold prices.
As for the actual demand for gold, it rose again during the week ending November 22, according to what was announced by the World Gold Council, showing that inflows to global gold-backed investment funds increased last week by 3.4 tons of gold.
This comes after a significant decline in cash flows to funds during the previous week by 23.6 tons of gold, due to the exit of large flows from investment funds in the European and Asian region in search of high-return investments.
