Gold prices showed a slight increase on Friday, with spot gold up by 0.2% at $2,369.99 per ounce as of 0703 GMT, though the metal has experienced a weekly decline of over 1%. U.S. gold futures also rose by 0.6% to $2,368.30. According to ANZ commodity strategist Soni Kumari, the recent surge to record highs last week was driven by expectations of a U.S. rate cut in September. However, this rapid rally has led to a correction, though the long-term outlook for gold remains positive.
Investors are now looking towards the U.S. personal consumption expenditure data for June, set to be released at 1230 GMT, which is the Federal Reserve’s preferred measure of inflation. Recent data showed that the U.S. economy grew faster than expected in the second quarter, while inflation pressures decreased, reinforcing the anticipation of a rate cut in September. Gold, which does not yield interest, becomes more attractive in a low-interest-rate environment. Sugandha Sachdeva, founder of SS WealthStreet, anticipates that with near-term support at the $2,280 level, gold could reach $2,680 by the end of the year.
Additional factors such as the upcoming U.S. elections and ongoing U.S.-China trade tensions could also cause a significant increase in gold prices. Data indicated that China’s net gold imports via Hong Kong dropped by 18% in June compared to the previous month. Nevertheless, ANZ’s Kumari noted that physical demand for gold in China is expected to rise, driven by difficulties in the property and equity markets. Additionally, India’s gold demand is predicted to increase as it moves into the fourth quarter, a period traditionally marked by high seasonal demand for gold.
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.
