Metal set for second consecutive month of gains on rising bets of a Federal Reserve rate in September
30 August 2024 - 08:11
byDaksh Grover
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Bengaluru — Gold prices eased on Friday, but were on track for a second consecutive month of gains on rising bets of a Federal Reserve rate cut in September, while traders awaited key US inflation data for additional guidance.
Spot gold was down 0.3% at $2,513.99/oz by 3.33am GMT, but on track to have increased about 3% in August. US gold futures fell 0.5% to $2,547.60.
The “overall trend in gold remains bullish due to lower rates and geopolitical tensions”, said Peter Fung, head of dealing at Wing Fung Precious Metals.
“By year-end, prices should break $2,650 and in the medium to long term, expect it to go above $2,800 and maybe even $3,000.”
Traders have fully priced in a US rate cut in September, with a 66% chance of a 25 basis point (bp) reduction and a 34% chance of a 50bp cut, according to the CME FedWatch tool.
Those odds could be influenced by US personal consumption expenditures (PCE) data, due at 12.30pm GMT.
“The size of a potential September Fed cut could well be influenced by how tame or otherwise the core PCE price index is,” said Tim Waterer, chief market analyst, KCM Trade.
Data released on Thursday showed US weekly jobless claims fell slightly last week but re-employment opportunities for laid-off workers are becoming more scarce.
On the geopolitical front, the Israeli military and Palestinian militant group Hamas had agreed to three separate, zoned three-day pauses in fighting in the Gaza Strip to allow for polio vaccinations, a senior WHO official said. Tensions have otherwise been high with fears of a widening conflict.
Spot silver slipped 0.2% to $29.38/oz, while palladium rose 0.29% to $940.40. Both metals are on track for monthly gains.
Platinum edged down by 0.1% to $978.50, set for a third consecutive month of losses.
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Gold on track to end the month on a high
Metal set for second consecutive month of gains on rising bets of a Federal Reserve rate in September
Bengaluru — Gold prices eased on Friday, but were on track for a second consecutive month of gains on rising bets of a Federal Reserve rate cut in September, while traders awaited key US inflation data for additional guidance.
Spot gold was down 0.3% at $2,513.99/oz by 3.33am GMT, but on track to have increased about 3% in August. US gold futures fell 0.5% to $2,547.60.
The “overall trend in gold remains bullish due to lower rates and geopolitical tensions”, said Peter Fung, head of dealing at Wing Fung Precious Metals.
“By year-end, prices should break $2,650 and in the medium to long term, expect it to go above $2,800 and maybe even $3,000.”
Traders have fully priced in a US rate cut in September, with a 66% chance of a 25 basis point (bp) reduction and a 34% chance of a 50bp cut, according to the CME FedWatch tool.
Those odds could be influenced by US personal consumption expenditures (PCE) data, due at 12.30pm GMT.
“The size of a potential September Fed cut could well be influenced by how tame or otherwise the core PCE price index is,” said Tim Waterer, chief market analyst, KCM Trade.
Data released on Thursday showed US weekly jobless claims fell slightly last week but re-employment opportunities for laid-off workers are becoming more scarce.
On the geopolitical front, the Israeli military and Palestinian militant group Hamas had agreed to three separate, zoned three-day pauses in fighting in the Gaza Strip to allow for polio vaccinations, a senior WHO official said. Tensions have otherwise been high with fears of a widening conflict.
Spot silver slipped 0.2% to $29.38/oz, while palladium rose 0.29% to $940.40. Both metals are on track for monthly gains.
Platinum edged down by 0.1% to $978.50, set for a third consecutive month of losses.
Reuters
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