Home Business News Gold prices near four-week high amid US economic slowdown and global tensions

Gold prices near four-week high amid US economic slowdown and global tensions

5th Jul 24 8:21 am

Gold prices increased on Wednesday and remained relatively stable on Thursday , approaching their highest levels in four weeks.

This rise followed the release of fresh U.S. economic data, which bolstered expectations that the Federal Reserve might cut interest rates in September.

This anticipation has led to a decrease in U.S. Treasury bond yields and a drop in the U.S. dollar to a three-week low.

In June, the US services sector experienced its most significant contraction in four years, which was unexpected. The survey also suggested a reduction in inflation pressures. Additionally, continuing jobless claims have increased for the ninth consecutive week, and growth in June’s private payrolls was slower than in previous months.

During their June meeting, Federal Reserve officials acknowledged the slowdown in the US economy but advised a cautious approach before deciding on any rate cuts, as reflected in the recent FOMC minutes. If tomorrow’s Non-Farm Payroll (NFP) report confirms this slowing trend in the labour market, gold prices could see more increases.

Political risks also remain a backdrop that supports the appeal of gold, particularly amidst ongoing political elections in Europe, including this week in the UK, and escalating geopolitical tensions in the Middle East.

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