- Gold rate tracking in euros - potential decrease in interest rates influence
The cost of gold is surging remarkably and has hit an unprecedented peak in euros. At certain points today, this valuable commodity was exchanged at 2,290 euros for a troy ounce (approximately 31.1 grams), breaking its own record. This upward trend continues for the third consecutive day this week, fueled by whispers of dropping interest rates.
On a global scale, gold's price is usually expressed in US dollars. It came close to breaking that record during today's trading. The troy ounce was traded around 2,529 dollars in London, staying just below the record peak of August 20th, when gold reached 2,531.75 dollars per ounce.
The forecast of falling interest rates, mainly in the USA, holds significant weight.
The primary catalyst driving gold's price is the speculation surrounding falling interest rates. As gold itself does not yield returns, the idea of reducing interest rates stimulates demand for this valuable substance. Experts pay close attention to interest rate predictions in the USA. A possible interest rate decrease in the USA, the first since the surge in inflation, is projected in the forthcoming week.
It's unclear how steeply the US Federal Reserve will reduce interest rates on September 18th. The central bank may respond to the recent drop in inflation and the relaxation of the economy with a minor interest rate reduction of 0.25 percentage points or a more substantial reduction of 0.50 percentage points.
Given the projected interest rate decrease in the USA, investors might consider this as an excellent opportunity for productive [Investment] in gold. With the anticipation of lower interest rates, the demand for gold, as a safe haven asset, is expected to increase further.
