This year alone, gold has reached 13 record highs and continues its upward trajectory. Analysts cite geopolitical concerns and potential Federal Reserve rate cuts as key factors fueling the rally
Gold prices surged past the $3,000 mark per ounce for the first time in history on March 14 amid global trade tensions and the US rate cut bets. As of 10.15 GMT, spot gold was up 0.4% at $3,000.87 an ounce, while US gold futures were up 0.7% to $3,013.60. This year alone, gold has scaled 13 all-time highs and remains on track for a second straight week of gains.
Exinity Group’s chief market analyst Han Tan said the precious metal still has an abundance of reasons to pursue higher prices, including geopolitical and economic concerns, along with the prospects of Fed rate cuts, as per Reuters report.
US President Donald Trump’s tariffs uncertainty has played a significant role in raising gold’s demand. The ongoing global trade war which has unsettled financial markets and fuelled recession concerns is still intensifying. On Thursday, Trump escalated tensions by threatening to impose a 200% tariff on alcohol imports from Europe.
“Next week’s FOMC decision, along with Chair (Jerome) Powell’s signals, are set to dictate whether spot gold remains above or below $3,000,” said Tan as quoted by Reuters.
On the other hand, SPDR Gold Trust also said the holdings of world’s largest gold-backed ETF were at 905.81 metric tons after reaching its highest level since August 2023 in late February. However, Wednesday’s data showed that US consumer prices were cooling down more than analysts’ expectations. This may create more room for Federal Reserve rate cuts.
The US fed meeting will take place on next Wednesday. Traders expect that policymakers will resume cutting borrowing costs in June. “We maintain our bullish stance on gold, with prices expected to reach a record high of $3,050 per ounce in 2025,” said analysts at ANZ.
In India, the commodity markets will open at 5 pm for the evening session. The market was closed for the morning session today, March 14, on the occasion of Holi. On Thursday, MCX gold prices ended flat at Rs 87,775 per grams.
(With inputs from Reuters)