Precious metal Gold price continues to chase records
The record hunt on the gold market has continued with the prospect of falling interest rates in the USA. In the morning, the price of a troy ounce (approx. 31.1 grams) on the London Stock Exchange rose to 2,589.64 US dollars, the highest it has ever been.
16.09.2024, 09:31
SDA
The price of gold had already reached record highs in recent trading days. The strongest price driver is the prospect of falling interest rates. Following clear indications from the ranks of the US Federal Reserve, the first interest rate cut since the wave of inflation is firmly expected on Wednesday.
However, the US monetary authorities have left the extent and sequence of future interest rate cuts open and made the decision dependent on the further development of economic data.
As gold itself does not yield interest, the prospect of falling interest rates on government bonds, for example, is increasing demand for the precious metal. For about a week now, the price of gold has been rising, in some cases sharply. During this time, the precious metal has gained almost four percent in value.
Weaker US dollar supports demand for gold
With the prospect of falling interest rates, the US dollar has also fallen in value recently, giving the gold price an additional boost. As gold is generally traded in dollars on the global market, a weakening of the US currency makes the precious metal cheaper in many countries, which supports demand and therefore the price.
Other reasons for a rising gold price include purchases by central banks to increase national reserves and concerns about a further escalation of the geopolitical situation due to the Gaza war in the Middle East and the Russian war of aggression against Ukraine.
