8:52 AM · 31 January 2025

Chart of the day - gold (31.01.2025)

Gold surges to record highs supported by macro data and weak dollar 💵

Gold surged to a record $2,800 per ounce, marking a 6.70% gain year-to-date. This rally is driven by mounting geopolitical tensions, tariff uncertainties, and a weakening U.S. dollar, which premiums gold as a safe-haven asset.

  • Market fears over broad-based tariffs are fueling demand for gold as a hedge against economic instability.

  • Comex gold inventories have surged 70% since the U.S. election, reaching a value of $85 billion.

  • The dollar continue to decline following Trump inauguration, Fed latest meeting and softer-than-expected U.S. GDP growth data. A weaker dollar historically supports gold prices.

  • The Fed held interest rates steady, with Chair Jay Powell signaling a cautious approach to further rate cuts.

The record surge in gold reflects market uncertainty driven by U.S. trade policy, interest rates, and currency fluctuations. Despite the ceasefire between Israel and Hamas and the absence of immediate tariffs during Trump’s presidency, the outlook remains unclear, particularly regarding inflation and commodity prices such as oil. The Fed is not planning swift rate cuts, with the first full reduction priced in for June. Gold is reaching its highest levels today, further supported by declining bond yields.

Source: xStation 5

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