The price of gold (XAU/USD) continued to rise for the second consecutive session, trading around $2,400 per troy ounce during the European session on Monday. Recent data from the US Personal Consumption Expenditures (PCE) Price Index, released on Friday, indicated a modest increase in inflation for June. This has raised expectations for the Federal Reserve to begin a rate-cutting cycle soon, leading to a decline in US Treasury bond yields. Consequently, the US Dollar has weakened, providing a boost to the non-yielding gold.
Geopolitical tensions in the Middle East further support the safe-haven appeal of gold. However, the upward momentum of gold prices is limited by the positive sentiment in global equity markets, which reduces demand for the traditional safe-haven asset. Additionally, traders are cautious as they await the results of the two-day Federal Open Market Committee (FOMC) meeting on Wednesday. This meeting, along with key US macroeconomic data, including the Nonfarm Payrolls (NFP) report due at the start of the new month, is expected to offer fresh direction for the commodity.
The interplay of inflation data, geopolitical risks, and upcoming economic reports continues to shape the outlook for gold prices, keeping traders attentive to new developments.
London-listed company KEFI Gold and Copper plc (LON:KEFI) is an exploration and development company focused on gold and copper deposits in the highly prospective Arabian-Nubian Shield. The Company operates in Ethiopia and Saudi Arabia with projects including Tulu Kapi project, Jibal Qutman EL and Hawiah.
