Gold continues to offer record high prices (Shutterstock)
Gold hit a new record high today, with investors growing more confident that the US Federal Reserve will cut rates this year, even after data showed a slight rise in a report on headline inflation.
There was a great demand for buying gold this year, while the US Central Bank hinted at the possibility of easing credit conditions.
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New record high
The price reached a new high of $2,256.73 per ounce, according to Bloomberg.
On Friday, the personal consumption expenditures index, on the basis of which the Federal Reserve measures inflation, showed a slight increase on an annual basis in March compared to last February.
Federal Reserve Chairman Jerome Powell said the report was “broadly in line with our expectations,” while policymakers are on track to achieve the 2% inflation target over the long term.
He explained that although the latest inflation data was higher than what the Federal Reserve had hoped for, the February numbers were “certainly more in line with what we want to see.”
Investors buy gold as a “safe haven,” and even when the economy is booming, consumers buy more jewelry (Shutterstock)
Fixed expectations
However, it seems that these data did not have much impact on traders’ expectations regarding a cut in interest rates next June, although Powell warned that they are unlikely to fall to the levels they reached after the global financial crisis in 2008.
Gold prices also tend to rise as a safe haven in times of turmoil in the face of increasing geopolitical tensions, and in light of fears of the expansion of the war launched by Israel in Gaza.
Source: French