Gold: prices rebound, but not enough to save weekly decline

Although it registers a rebound this Friday, gold prices are on track to experience their first weekly decline in three weeks. This decline is attributed to declining expectations of interest rate cuts, after lRecent minutes from the US Federal Reserve adopt a stricter tone.

Thus, spot gold shows an increase of 0.54%, reaching $2,340.95 per ounce, although it has fallen from its lowest point recorded since May 9. Despite hitting an all-time high of $2,449.89 on Monday, it has since seen a decline of approximately 5%.

In the gold futures market in the United States, a slight improvement of 0.21% is observed, standing at $2,342.10.

Gold: what the market analyzes

Ross Norman, an independent analyst, notes: “As the market begins to correct lower, those who missed out on the rally will undoubtedly take advantage of what they perceive as an opportunity to participate.”

The decline in the dollar index helps make bullion, valued in the U.S. currency, less expensive for foreign buyers.

Minutes from the Fed’s latest meeting, released this week, reveal intense debate among policymakers over whether current rates are restrictive enough to contain inflation. The possibility of higher interest rates makes gold, which does not earn interest, a less attractive investment.

Traders’ bets reflect growing doubts about the likelihood of the Fed making more than one rate cut during 2024. Currently, there is a 66% chance that a cut will be approved in November, according to CME’s FedWatch tool, compared to previous expectations that indicated a probable first cut in September.

As for other precious metals, Spot silver rose 1.4% to $30.53, having hit an 11-year high on Monday; platinum shows an increase of 0.4%, reaching $1,023.20; and palladium advances 0.2%, standing at $971.05. However, all three metals are on track to post weekly losses.