Gold Price Hits New Record High Amid Expectations of Federal Reserve Rate Cuts and Trump's Presidential Bid
The price of gold has reached a new historic high as expectations of Federal Reserve rate cuts increase and some traders bet on a second presidency for Donald Trump. This morning, spot gold is trading at over $2,467 per ounce, which means the gram is at $79.32, or 245 dinars. Since the beginning of the year, the price has evolved by more than 16%. American gold futures contracts are at a record high of over $2,471 per ounce.
This surge is driven by anticipation of an easing of monetary policy by the Fed, as well as significant purchases by central banks. Geopolitical tensions have also supported the metal, which is traditionally considered a safe-haven asset. Earlier this week, Federal Reserve President Jerome Powell stated that recent data had given policymakers greater confidence that inflation was heading towards the central bank's 2% target.
This dynamic is no surprise. Major global banks have predicted a new record this year. Citigroup has even gone further, declaring a base scenario for gold in 2025 between $2,700 and $3,000 per ounce.
Moreover, Trump's presidential bid has gained momentum after an assassination attempt last weekend and the dismissal of a criminal case against him. However, his victory could have both positive and negative effects on gold. It could lead to tax cuts, supporting a shift towards stocks, and potentially limiting faster rate cuts. On the other hand, tax cuts would impact the US budget balance, which could weaken the dollar and drive buyers towards safe-haven assets like gold.
What's important to remember is that gold is ready to continue its upward trend in the current global geopolitical and macroeconomic landscape.
