By David Brough
Gold prices held steady in mid-October, not far below September’s record high, but faced resistance from a strong dollar and profit taking.
Gold hovered down 0.11 percent at USD 2,646.43 per ounce on October 15, with upside limited by a U.S. dollar trading at near 2-month highs, and by profit taking. Gold prices have risen by nearly 30 percent so far this year.
Some analysts see potential for more upside in gold prices, perhaps to hit a new all-time high later in 2024 after touching a record high of $2,685.42 per ounce last month.
But moves towards a new peak may be slowed by the strength of the dollar in which gold is denominated, and by the profit taking.
The key elements are in place for further upside in gold: expectations of at least one further U.S. rate cut later this year, and a climate of geopolitical uncertainty due to the wars in Ukraine and the Middle East.
Prices of non-yielding gold can move upwards in a climate of falling interest rates, while geopolitical uncertainty boosts the “safe haven” appeal of bullion.
(Disclaimer: Any opinion expressed in this commentary is solely that of the author, and does not constitute investment advice.)
