Gold Reaches Record High Before US Economic Data Release
Gold surged to a record high ahead of upcoming US economic data that could provide insights into the Federal Reserve’s monetary policy direction.
Bullion climbed as much as 0.4% to reach $2,631.13 an ounce, surpassing its previous all-time high set on Friday, according to Bloomberg.
Traders are closely watching the outlook for rates ahead of key economic data releases, including the US personal consumption expenditures gauge and jobless claims due later in the week.
Fed Governor’s Comments
Fed Governor Christopher Waller’s comments on Friday indicated potential quarter-point cuts at upcoming central bank policy meetings, with the possibility of a half-percentage-point cut if the job market weakens.
While the bullish momentum for gold is strong, there are concerns about the rally being overextended, with some investors viewing the current 14-day relative-strength index as overbought. Hedge funds and speculators have been increasing bullish wagers on Comex, reaching the highest net-long bullion positions in four years.
Christopher Wong, FX strategist at Oversea-Chinese Banking Corp., emphasized caution in the near-term, highlighting potential technical support levels for gold around $2,580 an ounce.
Support from Haven Demand
Gold is also benefiting from increased haven demand as tensions escalate in the Middle East, particularly concerns about potential broader regional conflict arising from fighting between Hezbollah and Israel.
As of 1:09 p.m. in Singapore, spot gold was up 0.3% to $2,629.14 an ounce after a 1.7% gain the previous week. The Bloomberg Dollar Spot Index remained stable, while silver, palladium, and platinum prices declined.
