Gold prices touched an all-time high during early Monday trading

Gold prices touched an all-time high during early Monday trading, reflecting growing expectations of a Federal Reserve rate cut within the first quarter of 2024 and simmering geopolitical instability in the Middle East. With inflation coming down faster than expected and economic activity showing signs of weakness, investors are growing increasingly hopeful that the next Fed move will be a cut, which could, according to the most optimistic, come as early as March next year. Against this background, with softening treasury yields, the opportunity cost of holding the non-yielding metal is decreasing, with demand and prices moving in the opposite direction. At the same time, tensions are again rising in the Middle East, with attacks on ships in the Red Sea driving the precious metal's haven appeal.

Ricardo Evangelista – Senior Analyst, ActivTrades