Gold hits three-month high, dollar starts the week with a new record

Markets started the week with a rise in precious metals and foreign exchange rates. Driven by the weakening of the US dollar, spot gold climbed to 4,656.42 dollars during the day, reaching its highest level since May 15. As of 08:05 TSI, ounce gold was trading at the 4,641 dollar level.

The rise in gold also carried over to gram gold prices. With the increase in the dollar/TL exchange rate added to the rise in ounce gold, gram gold was trading at 7,196 lira at 08:05 TSI.

On the foreign exchange side, an upward trend stood out in the first transactions of the week. The dollar/TL exchange rate rose to 48.07 in the morning session, hitting an all-time high. Meanwhile, the Euro/TL was trading at 56.19 at the same time.

INTEREST RATE EXPECTATIONS AND GEOPOLITICAL RISKS ARE BEING MONITORED

Behind the movement in gold are the dollar's proximity to multi-month lows in global markets, concerns regarding the US fiscal outlook, and an increase in safe-haven demand. The depreciation of the dollar makes gold more attractive for investors trading in other currencies.

One of the most important data points that markets will monitor this week will be the US Personal Consumption Expenditures (PCE) price index. This inflation indicator, closely watched by the Fed, could be decisive for expectations regarding interest rate cuts. It is assessed that if inflation remains below expectations, the supportive effect on gold, which does not provide interest income, could strengthen.

Investors are also focused on the messages that Fed Chair Kevin Warsh will deliver at the Jackson Hole symposium. Maintaining a more cautious tone regarding monetary policy is cited among the factors that could support the current upward trend in gold.

Geopolitical risks are also being monitored as one of the topics supporting gold prices. The US preparing for new and comprehensive economic sanctions against Iran is considered among the developments limiting risk appetite in the markets.

In contrast, no similar movement was observed in other precious metals. Spot silver fell 0.3 percent to 68.76 dollars, platinum lost 0.5 percent to 1,868.03 dollars, and palladium declined 0.3 percent to 1,345.87 dollars. Market experts state that if the current momentum is maintained, the 4,700 dollar level will be monitored as the new threshold for gold.

News Source: 12punto