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The weak US dollar and investor confidence in the US interest rate cut helped gold prices rise to $2,531/ounce in the first session of the week.
At the end of the trading session on August 20, the world spot gold price increased by 10 USD to 2,513 USD per ounce. During the session, the price reached a new record high of 2,531 USD.
The Dollar Index, which measures the greenback against a basket of major currencies, fell to a seven-month low yesterday, making gold more attractive to buyers outside the United States. Yields on 10-year U.S. government bonds also fell.
"The main reason for the increase in gold prices is the demand for financial investment, especially from ETFs. Investor confidence in general has also improved as they expect the US Federal Reserve (Fed) to cut interest rates at its September meeting," said Aakash Doshi, Director of Commodities for North America at Citi Research. He predicted that gold prices could reach $2,600 by the end of this year and $3,000 an ounce by the middle of next year.
Yesterday, holdings at SPDR Gold Trust - the world's largest gold ETF - also hit a seven-month high of 859 tonnes. The CME FedWatch interest rate tracker shows that the market is now betting on a 71% chance of the Fed cutting interest rates by 25 basis points (0.25%) in September.
Investors will be closely watching the Fed this week, including the minutes of its July meeting, due on August 21, and a speech by Fed Chairman Jerome Powell on August 23.
Gold prices have risen more than 20% since the start of the year, and the precious metal is on track for its biggest annual gain since 2000. "Geopolitical volatility, speculative demand and increased ETF buying are all supporting gold prices," said Joseph Cavatoni, market strategist at the World Gold Council.
Except for gold, other precious metals lost value yesterday. Silver fell 0.2% to $29.4/ounce. Platinum lost 0.5% to $949/ounce. Palladium fell 0.5%, closing at $927/ounce.
TB (according to VnExpress)