Gold prices fell 1% last Friday to $3,015.43 per ounce, primarily influenced by a stronger dollar and profit-taking. However, geopolitical and economic uncertainties persist, along with the Federal Reserve's expected rate cuts, leading to a three-week consecutive rise in gold prices.
U.S. gold futures fell 0.7%, settling at $3,021.40. Traditionally, gold is viewed as a safe-haven asset during times of geopolitical and economic turmoil, often performing well in low-interest environments. This year, gold has reached historic highs 16 times, with a record high of $3,057.21 per ounce on Thursday.
Marex analyst Edward Meir stated that the market is currently undergoing some adjustments with profit-taking, and the stronger dollar has also pressured gold prices. The Trump administration's plan to implement new reciprocal tariffs on April 2nd has further increased market uncertainty.
The Federal Reserve announced last Wednesday that it would keep the benchmark interest rate unchanged but signaled two rate cuts this year, each by 25 basis points. Data from the London Stock Exchange Group (LSEG) indicates that the market expects the Fed to cut rates by 71 basis points this year, with the July rate cut fully priced in by the market.
On the geopolitical front, Israel announced air, sea, and land strikes against Hamas in Gaza, attempting to force the release of remaining hostages. This marks a shift from the previous two-month ceasefire agreement, as Israel launched a comprehensive military offensive against the Palestinian militant group. Such developments further increased the market's safe-haven demand for gold.
Spot silver fell 1.7% to $32.97 per ounce, platinum prices dropped 1.1% to $973.45, while palladium rose 0.1% to $953.14.
