Gold rises due to Middle East geopolitical tensions
Market expectations are growing that the Fed is preparing to cut interest rates in September. While gold prices remain on an upward trend, some investment firms are warning investors that the market will be volatile in the coming period.
Fed funds futures are fully pricing in a September 2024 rate cut for the US, and the market consensus is for 100 basis points of cuts next year. However, with the European Central Bank and several other developed world central banks already starting their rate-cutting cycle, the US dollar remains firm, providing a headwind for dollar-denominated gold.
On Thursday (1/8), the Bank of England (BoE) cut the Bank Rate by 25 basis points to 5%.
The Bank of England is now the third major central bank to cut interest rates ahead of the US Federal Reserve, along with the Swiss National Bank, the Bank of Canada and the European Central Bank.
Fed funds futures are fully pricing in a September 2024 rate cut for the US, and the market consensus is for 100 basis points of cuts next year. However, with the European Central Bank and several other developed world central banks already starting their rate-cutting cycle, the US dollar remains firm, providing a headwind for dollar-denominated gold.
On Thursday (1/8), the Bank of England (BoE) cut the Bank Rate by 25 basis points to 5%.
The Bank of England is now the third major central bank to cut interest rates ahead of the US Federal Reserve, along with the Swiss National Bank, the Bank of Canada and the European Central Bank.
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