The slight increase in gold prices reflects shifts in investor sentiment towards safe-haven assets amid ongoing geopolitical risks and concerns about trade wars. This recovery indicates that gold continues to attract significant interest from investors who see it as a store of value amid economic uncertainty.
The Federal Reserve has pointed out that inflation risks remain elevated, and economic forecasts suggest a limited interest rate cut shortly. This hawkish monetary policy has pushed yields on U.S. Treasury bonds to their highest levels since May, strengthening the dollar and putting pressure on gold.
This is likely to continue exerting pressure on gold in the near term, especially with rising bond yields being a crucial factor in determining the attractiveness of gold as a store of value.
Attention is now focused on the final reading of third-quarter GDP, as well as unemployment claims data, expected to help gauge the momentum of the U.S. economy and its impact on the U.S. dollar and gold.
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