MARKET COMMENTARY – Gold hit record high heading into Easter weekend amid anticipation of U.S. rate cuts

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Gold prices went into the Easter weekend at fresh record highs on March 28, 2024, hitting USD $2,225 per ounce during the North American session.

Gold priced in euros set a record at around €2,050 per ounce, while the UK gold price in pounds per ounce touched new London benchmark peaks at more than £1,752, BullionVault reported.

“A rising gold price suggests the market expects further falls in inflation should support central bank moves to cut rates later this year,” Australasian bank ANZ said.

Gold had already hit price peaks after the U.S. Federal Reserve (central bank) anticipated three rate cuts in 2024 despite recent high inflation figures.

Traders see a 70% likelihood of a June 2024 rate cut from the U.S. Federal Reserve.

Lower interest rates reduce the opportunity cost of holding non-yielding gold.

Some analysts believe that further signs of cooling inflation in the United States may contribute to upside impetus to gold prices in the coming months.

High gold prices may drag on bullion imports into major consuming and jewellery manufacturing countries, such as India and Turkey.

 

MARKET COMMENTARY – Gold hit record high heading into Easter weekend amid anticipation of U.S. rate cuts

Gold jewellery, photographed at a recent edition of Italian trade show Oroarezzo