Last weekend in the New York market, gold prices dropped to 2612 due to rising U.S. long-term interest rates.
At the same time, all three major indices in the New York stock market fell sharply, indicating a “risk-off” mood that is helping to support gold prices.
As many people continue their Christmas holidays until the end of the year, the market remains cautious. However, issues like the U.S. debt problem and a possible downgrade of the U.S. credit rating could further increase the demand for gold as a safe asset.
Earlier this year, in February, while the U.S. and Japanese stock markets hit record highs, gold started its real upward trend from around $2000.
Gold was boosted by growing geopolitical risks, the Federal Reserve’s (FRB) decision to start lowering interest rates, and China’s decision to resume buying gold as part of its foreign currency reserves.
This year, gold is expected to remain strong, supported by continued geopolitical risks, central banks buying gold, and the Federal Reserve cutting interest rates.
On the other hand, a potential risk is that the new Trump administration could trigger inflation, causing interest rates to rise again, which may limit gold’s upward movement.
However, as the influence of BRICS grows and the demand for dollar-based settlements decreases, there is concern about a weakening trust in the dollar. This could help gold prices stay strong in 2025.
XAU/USD Forecast Range Until Year-End: 2630–2605
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