On Thursday, spot gold prices hit a new high, soaring to $2,558.58 per ounce with a nearly 2% increase. This surge was mainly driven by the European Central Bank's rate cut and disappointing U.S. economic data. Analysts believe that with the Federal Reserve possibly cutting rates next week, gold's appeal continues to grow.
The weak U.S. labor market and the decline in the Producer Price Index have heightened market concerns about an economic slowdown, further boosting expectations for a Fed rate cut next week. CME's "FedWatch" tool shows an almost 85% chance of a 25-basis-point rate cut by the Fed, providing strong support for gold prices.
Additionally, after the European Central Bank announced a 25-basis-point rate cut, the EUR/USD pair surged, causing the U.S. Dollar Index to tumble, further pushing up gold prices. The market generally expects that with global central banks gradually entering a rate-cutting cycle, the upward trend in gold may continue, with the next key resistance level at $2,600 per ounce.
Investors are currently closely monitoring the Fed's decisions and signs of a global economic slowdown. Gold prices are likely to continue receiving support, with market enthusiasm still rising.
