Rise begins in the gold market

Employment results in the US that fell below expectations continue to push gold prices upward. As current prices for gram gold, quarter gold, and Republic gold have come to light, spot gold has also reached its highest levels in recent weeks.

With investors' expectations strengthening that the US Federal Reserve (Fed) may cut policy interest rates, spot gold rose 1.4 percent to see 4,179.94 dollars. US gold contracts for August delivery also traded at 4,193.20 dollars, a 1.6 percent increase. These increases were recorded as the highest levels since June 23.

US NON-FARM AND PRIVATE SECTOR DATA WERE EFFECTIVE

With the non-farm payroll and private sector employment data announced in the US remaining below estimates, there was a reduction in inflationary pressures and a loosening of concerns that interest rates would remain high for a long time. These developments paved the way for gold to gain 2.3 percent in value on a weekly basis, bringing it to the threshold of a weekly gain for the first time in about six weeks.

The weakening of the US dollar is also increasing global interest in gold. The depreciation of the dollar has made gold more attractive to investors using different currencies.

NEW CALCULATIONS IN FED'S INTEREST RATE POLICY

Expectations regarding the Fed's interest rate policy for the coming period are also changing. OANDA Senior Market Analyst Kelvin Wong stated, "The market is reducing its expectation that the Fed will raise interest rates for the remainder of this year and the first quarter of next year. The main reason for this is the US labor market data released yesterday, which fell below expectations."

According to the statement from the US Department of Labor, non-farm employment increased by only 57 thousand people in June. Looking at CME FedWatch data, the probability of the Fed raising interest rates in September was 66 percent before the data was released, but it has now fallen to 54 percent.

Wong notes that the possibility of an interest rate hike has not completely disappeared and that a decrease in gold prices could be seen later in the year. The analyst predicts that spot gold could fall to the 3,500 dollar level towards the end of the year.

CENTRAL BANKS ARE INCREASING THEIR RESERVES

According to data from the World Gold Council, central banks accelerated their gold reserve increases again in May. According to official records, the net increase in gold reserves last month was 41 tons.

PRECIOUS METAL PRICES ARE ACTIVE

Silver, platinum, and palladium also took their share of the rising markets. Spot silver saw 62.43 dollars per ounce with a 2.3 percent increase, platinum saw 1,660.05 dollars with a 2.7 percent rise, and palladium saw 1,284.40 dollars with a 1.3 percent premium. These metals are also testing new peaks in their rallies that have been ongoing for more than a week.

The upward trend in gold and precious metals is expected to continue to be shaped by global economic developments and the reserve policies of central banks.