Gold Market
Gold briefly spiked above $4,200 on soft PCE data but quickly reversed, leaving the metal near its year-low. We examine the short-term headwinds and why the longer-term picture still favours higher prices.
Gold initially dropped on the Fed's first rate hike in over three years but quickly surged the next day, suggesting the pattern of selling on rate-hike fears may be fading.
Gold’s price range of 4,230–4,697 remains intact. Friday’s US CPI may shift prices within that zone, but the bigger forces are the Fed’s expected rate peak, oil normalisation and the dollar debasement trade.
Gold prices wavered after a surprisingly strong US jobs report, but analysts see the pullback as temporary amid rising debt, bond yields, and geopolitical tensions.
Examining the historical evidence reveals that gold has preserved purchasing power over very long periods, but its performance as an inflation hedge is less reliable over shorter time frames.