GOLD price held its ground on Tuesday (Oct 1), following a decline of nearly 1 per cent in the previous session, as investors awaited upcoming US data for insights on potential interest rate cuts this year.
Spot gold was steady at US$2,635.89 per ounce, as at 0006 GMT. Bullion hit a record high level of US$2,685.42 on Thursday.
US gold futures edged 0.1 per cent lower to US$2,657.50.
Federal Reserve chair Jerome Powell said on Monday he sees two more interest rate cuts, totalling 50 basis points, this year as a baseline “if the economy performs as expected”, though the Fed could cut faster, or slower, if needed.
Traders on Monday favoured a quarter-point interest rate cut in November over another half-point cut, following Fed chair Jerome Powell’s remarks that rates will reach a neutral level “over time”.
Meanwhile, Chicago Federal Reserve president Austan Goolsbee reiterated on Monday that he supports significant interest rate cuts based on the current economic conditions and their expected trajectory.
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Lower interest rates reduce the opportunity cost of holding bullion, which is also viewed as a safe asset during economic and political turmoil.
On the geopolitical level, Israel’s anticipated ground invasion of Lebanon began early Tuesday, with its military reporting “limited” raids on Hezbollah targets near the border.
The market will be closely watching US job openings data later today, as well as remarks from various Fed officials, for more hints.
Goldman Sachs raised its gold price forecast for early 2025 to US$2,900 per ounce, up from US$2,700, citing increasing ETF flows due to interest rate cuts in the West and China, as well as higher central bank purchases.
Spot silver was up 0.2 per cent to US$31.22 per ounce, platinum gained 0.5 per cent to US$980.80 and palladium was flat at US$999.32. REUTERS
