Gold prices took a hit yesterday amid growing geopolitical tensions in the Middle East. At press time, the yellow metal was trading at $2651.70 per ounce, down 0.32%. Yesterday, the spot prices had fallen to $2649.41 per ounce. Gold futures price, on the other hand, rose to $2,671.30 per ounce today, rising 0.05%. The US Dollar also witnessed a slight increase today.
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The US Dollar index (DXY) rose to 101.82 today, an increase of 0.13%. The strengthening of the dollar may have created barriers to the rise of yellow metal as USD-priced bullion became more expensive in other currencies.
Gold has risen more than 28% this year and is close to its $2,685.42 per ounce peak. On the other hand, the US dollar index has been flat for the past year. The currency is down around 5% from its April highs.
Will Gold Recover, If So, Will The US Dollar Slide?
Political tensions in the Middle East, the upcoming US elections, and the possibility of an interest rate cut in November likely influence the price of the yellow metal and the greenback.
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According to Bob Haberkorn, senior market strategist at RJO Futures, “It’s very reasonable to see (gold) prices go north of $2,700 per ounce, if Israel does in fact strike Iran.“
The US Dollar could see some movement due to the US election. Many analysts believe a win from Republican candidate Donald Trump could lead to the greenback climbing.
Traders also anticipate another Federal Reserve interest rate cut. 67.4% of traders anticipate a 25 basis-point rate cut in November. This development could also impact the price of gold and the DXY.
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