Lazy eyes listen
On Monday, gold prices rose to their highest level since May, hovering above $2,000 per ounce, thanks to a weaker US currency and anticipation that the Federal Reserve’s interest rate hiking cycle is coming to an end.
According to Reuters, spot gold was up 0.6% at $2,012.92 per ounce at 10:19am GMT after reaching its highest level since May 16 at $2,017.82. Gold futures in the United States increased 0.5% to $2,013.80. Last week, gold broke through the psychological barrier of $2,000 per ounce.
The dollar lost 0.1% versus a basket of currencies on Monday, closing in on the two-month low reached last week. When the dollar falls in value, gold becomes less expensive to purchase for holders of other currencies.
The bullion’s uptrend has also been driven by speculation that the US Federal Reserve will not raise interest rates any more, as recent preliminary figures suggested a slowdown in inflation. Lower interest rates reduce the opportunity cost of holding non-interest-bearing assets, often boosting gold prices, Reuters explained. New official US inflation data is due later this week.
Since the beginning of the conflict between Israel and the Palestinian armed group Hamas in early October, gold has been on the rise. Experts and traders predict that the Middle East’s unrest will continue to drive up the price of gold, which has traditionally been viewed as a safe haven during times of economic uncertainty.