Home Business News Global economic uncertainty sparks gold prices to hit all time highs of over $2,350

Global economic uncertainty sparks gold prices to hit all time highs of over $2,350

by Thea Coates Finance Reporter
8th Apr 24 2:44 pm

Gold prices soared to new highs during Asian trading on Monday, brushing off speculations of U.S. rate cuts as the demand for the precious metal persisted as a safe haven.

Investors eagerly awaited further insights into the state of the U.S. economy.

Despite technical signals suggesting an overbought market, gold’s rally remained robust.

Spot gold climbed by as much as 0.7% to reach a historic peak of $2,353.81 per ounce, while gold futures expiring in June surged 0.8% to hit a record high of $2,372.45 per ounce.

Gold prices increased as the dollar showed no reaction to a massive nonfarm payrolls report for March.

The report, released on Friday, revealed that the U.S. labour market remained robust. Such a scenario provides little encouragement for the Federal Reserve to begin lowering interest rates soon.

However, the dollar exhibited minimal strength following the report, giving gold more leeway to move higher. Uncertainty surrounding US rates remained in play ahead of important consumer price index inflation data, which is due this Wednesday.

Geopolitical tensions fuel demand for gold 

The CME Fed watch tool revealed that traders were generally reducing their bets that the Fed would lower interest rates as early as June.

However, worsening global geopolitical concerns have kept safe-haven demand for gold strong. The Russia-Ukraine war rages on, with additional strikes on the Zaporizhzhia nuclear plant raising alarm.

In the Middle East, concerns over a war between Iran and Israel also remained in play, despite Israel’s appearance in Egypt to hold peace negotiations with Hamas.

Other precious metals rose on Monday. Platinum futures increased 0.1% to $941.70 per ounce, while silver futures rose 1.0% to $27.965 per ounce.

Copper retreats from 15-month highs

Copper prices dipped marginally on Monday, indicating profit-taking after reaching 15-month highs last week.

Three-month copper prices on the London Metal Exchange declined 0.2% to $9,333.50 per tonne, while one-month U.S. copper futures fell 0.3% to $4.2287 a pound.

Copper was boosted by a string of positive economic readings from top importer China, which showed business activity in the country was picking up.

The prospect of tighter refined copper supplies boosted prices after top Chinese refiners signalled potential production cuts. China is expected to release more economic data later this week, including March inflation and trade figures.

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