"The swift return of institutional inflows suggests that hedging demand remains intact. This is a key factor supporting gold's elevated price base, particularly as policy and geopolitical uncertainties have yet to be fully resolved."
"The main constraint on gold's upside stems from the interest rate environment. U.S. inflation remains above the Federal Reserve's 2% target, making near-term monetary easing more difficult. As a result, gold may struggle to stage a strong breakout in the short term, even though safe-haven demand persists."
"In an environment where growth is slowing, but inflation has not been fully contained, gold typically serves as a portfolio risk-balancing asset. Uncertainties surrounding trade policy and the global growth outlook continue to provide an underlying layer of support for the precious metal."
Gold is trading just below $5,200/oz, balanced between safe-haven demand and easing geopolitical tensions. US-Iran nuclear negotiations in Geneva remain inconclusive, maintaining geopolitical risks without escalation. SPDR Gold Trust purchased nearly 19 tons across three sessions, signaling intact hedging demand from institutions. However, elevated US inflation above the Federal Reserve's 2% target constrains monetary easing and limits gold's upside. Trade policy uncertainties and slowing global growth provide underlying support, positioning gold as a portfolio risk-balancing asset. Future price movements depend on US-Iran negotiations outcomes, US economic data releases, inflation trends, labor market figures, and Treasury yield movements.
#gold-price-analysis #geopolitical-risk #monetary-policy #safe-haven-demand #institutional-investment
Read at London Business News | Londonlovesbusiness.com
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