Wednesday, February 21, 2024

According to Investing.com, gold prices have fallen significantly after reaching an all-time high…losing more than 2% in moments.

Date:

© Reuters.

Investing.com – After hitting new all-time highs in the yellow metal market, gold prices fell sharply in the past few minutes on profit-taking.

Gold prices hit an all-time high above $2,100 an ounce in the past few hours after Federal Reserve Chairman Jerome Powell’s statements bolstered traders’ hopes that the US central bank could cut rates early next year.

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Heng Kun Hau, UOB’s head of market strategy and global economics and market research, noted that the dollar’s decline and interest rate expectations for 2024 will be a strong driver of gold prices. His expectations indicate that gold prices will reach $2,200 by the end of 2024.

For his part, Bart Melek, head of commodity strategies at TD Securities, expects gold prices to average $2,100 in the second quarter of 2024, with strong buying support from central banks as the primary price driver.

A new survey by the World Gold Council found that 24% of central banks intend to increase their gold holdings in the next 12 months, signaling a trend towards increased demand in the formal sector in the coming years.

Supporting market sentiment, data last week pointed to easing inflationary pressures and a gradual decline in labor market strength, with Federal Reserve Governor Christopher Waller hinting at the possibility of cutting interest rates if inflation continues to ease.

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Investors’ attention now turns to US Nonfarm Payrolls data – a key employment report due on Friday that could weigh on US interest rate expectations.

However, bullish gold prices seem to have come under some pressure in the past few minutes as the yellow metal market witnessed intense selling pressure leading to a significant fall in gold prices.

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Now gold and the dollar

It is currently down 2.24% to $2042 per ounce.

It was down 2.3% to $2024 an ounce.

On the other hand, the dollar index gained 0.55% to 103.76 points.

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Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

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