Taking care of rates for the demand for safe ports?
Trumps rhetoric about rates, including proposed taxes on imports from Mexico, Canada and China, increased concern about global trade disruptions. These uncertainties drove investors to gold as protection against economic instability. The expectations of a “friendlier” solution for trade discussions with China caused some relief, but the skepticism remains high.
Will the inflation and interest on government bonds continue to support gold?
The fear of inflation was also clear when analysts noticed the potential impact of rates on consumer prices. The interest on American government bonds fell because the markets absorbed Trump’s comments and waited for important economic figures, which further supported the gold price. Blackrock CEO Larry Fink warned that rising inflation could challenge stock markets, which would indirectly benefit gold.
What role will the Fed Meeting play in the next move of gold?
Looking ahead, all eyes are focused on the Federal Reserve meeting next week, where no interest changes are expected. However, the Fed statement after the meeting and the comments of chairman Jerome Powell will be crucial for the market sentiment. Important economic data, including GDP for the fourth quarter and the Personal Consumption Expenditures (PCE) index, are also on the calendar, which may increase volatility on the gold markets.