Gold prices have hit a new all-time high, driven by expectations of further Fed rate cuts and rising geopolitical tensions in the Middle East. The United Nations (UN) has warned of a potential catastrophe in the region, which could increase safe-haven demand for gold.
Fed Rate Expectations
The Federal Reserve (Fed) is expected to continue cutting interest rates, with a high probability of a 50 basis points (bps) reduction in November. Recent comments from Fed officials suggest a dovish stance.
Economic Data
The People’s Bank of China (PBoC) cut its 14-day reverse repo rate by 10 basis points, injecting additional liquidity into the financial system.
Technical Analysis
Gold prices have entered the overbought zone, according to the Relative Strength Index (RSI). This suggests a potential short-term correction. However, the long-term trend remains bullish, with potential targets at $2,650 and $2,700.