Bullion surged over 27% in 2024, its largest annual gain since 2010. — Reuters
NEW YORK: Gold prices are inching higher, continuing its momentum from 2024, while traders sought more clarity on the US Federal Reserve’s (Fed) interest rate trajectory and President-elect Donald Trump’s policies.
Spot gold rose 0.39% to US$2,634.15 per ounce, as of 0255 GMT yesterday. US gold futures edged up 0.2% to US$2,646.30.
Bullion surged over 27% in 2024, its largest annual gain since 2010, driven by the Fed’s substantial rate cuts and escalating geopolitical tensions.
The US dollar index slipped 0.1%, making US dollar-priced bullion more affordable for holders of other currencies.
“Gold seems to be consolidating in a tight range, which often signals a market that’s poised for a breakout.
“I suspect that breakout will be to the upside,” said Kyle Rodda, financial market analyst at Capital.com.
Gold is likely to remain bullish in 2025, driven by geopolitical risks and expectations of rising government debt due to a deep fiscal deficit under Trump’s administration, despite potential challenges from slower Fed rate cuts and US dollar strength, Rodda said.
The market now awaits a fresh set of catalysts, including a slew of US economic data due next week that could influence the interest rate outlook for 2025, and Trump’s tariff policies.
Meanwhile, traders anticipate the Fed to adopt a slow and cautious approach to further rate cuts in 2025, as inflation continues to exceed its 2% target.
Gold is viewed as a hedge against inflation, particularly in times of geopolitical and economic uncertainty. — Reuters
