Gold is rallying yet again, and the previous all-time high in dollars is within touching distance.
Hopes of a rate cut from the Federal Reserve are rising as US inflation continues to show signs of falling, and members of the Fed have struck a more dovish tone in recent statements. Combined with some further volatility in the wake of the assassination attempt on Donald Trump at the weekend, and gold is seeing renewed interest.
Gold has enjoyed a strong 2024 so far, and new records are within reach.
Having set a previous all-time high of $2,450.85 in May, gold is now just $12 away at the time of writing and has been as close as $2,440 yesterday. Gold’s rally has been rapid again, with the metal advancing almost $100 per ounce in the past week, a gain of more than 3%. It won’t take much of a push now to see yet another all-time high for gold in 2024.
The dollar’s weakness has kept gold in other currencies from their records so far. The pound is at its highest in a year against the dollar, keeping gold in GBP suppressed with a weekly gain of 2% and trading around £1,880 per ounce below it’s record of £1,950. The Euro is also up compared to the lows of April, and leaves gold up 2.5% for the week at €2,236 per ounce, near its record of €2,277.
Jerome Powell has already hinted that rate cuts are on the way following positive inflation data last week, and Donald Trump’s odds of winning the US election have only improved after the weekend’s violence. The US and the strength of the dollar then are the key known quantity for gold in the months ahead. After the unexpected spring rally however, the historic level of $2,500 could be reached sooner rather than later based on recent performance.
If gold matches last week’s performance this week, we will see $2,500 in the next few days, but the metal could hit some resistance on it’s way up towards this key milestone.
