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Gold continues to attract safe-haven flows, setting a new record high near $3,039 per ounce on Wednesday. Several factors contribute to this price surge, including
- Rising geopolitical tensions in the Middle East, particularly Israeli airstrikes on Hamas targets in Gaza, which have resulted in over 400 casualties. Israeli Prime Minister Benjamin Netanyahu stated that the strikes were necessary after Hamas rejected proposals to extend the ceasefire that had been in place since January.
- Rising geopolitical tensions in the Middle East, particularly Israeli airstrikes on Hamas targets in Gaza, which have resulted in over 400 casualties. Israeli Prime Minister Benjamin Netanyahu stated that the strikes were necessary after Hamas rejected proposals to extend the ceasefire that had been in place since January.
- Rising geopolitical tensions in the Middle East, particularly Israeli airstrikes on Hamas targets in Gaza, which have resulted in over 400 casualties. Israeli Prime Minister Benjamin Netanyahu stated that the strikes were necessary after Hamas rejected proposals to extend the ceasefire that had been in place since January.
- Trade war fears fueled by Trump’s latest tariff threats. The US president announced plans to impose reciprocal and sectoral tariffs, effective April 2, in addition to the 25% tariff on steel and aluminum implemented in February. This move increases concerns over a potential global trade conflict.
- Growing expectations of Fed rate cuts due to fears of an economic downturn caused by the Trump administration’s aggressive policies. Markets now anticipate three 25 basis-point rate cuts at the June, July, and October meetings, further supporting the appeal of non-yielding gold.
- A slight rebound in the USD, which recovered from a five-month low on Tuesday as traders closed bearish positions ahead of the Fed’s decision. However, the greenback’s recovery remains fragile.
The FOMC monetary policy statement and Jerome Powell’s remarks will be closely watched for signals on the future trajectory of US interest rates. These factors will play a key role in shaping demand for the USD and, consequently, influencing gold price movements in the near term.
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