NEW YORK, July 29 (Wednesday) — Gold prices have resumed their upward trend in global markets, supported by a decline in the value of the US dollar. However, market analysts say the sustainability of the rally will largely depend on the next policy decisions of the US Federal Reserve, particularly regarding interest rates.
According to a Reuters report, spot gold prices rose 0.3 percent to $4,040.63 per ounce by 6:56 GMT on Wednesday.
At the same time, US gold futures for August delivery remained largely stable, trading at around $4,038.90 per ounce.
Analysts said a weaker dollar generally boosts demand for gold in international markets, as the precious metal becomes relatively cheaper for investors holding other currencies.
However, investors are now closely watching the Federal Reserve’s upcoming interest rate decisions and its future policy direction in tackling inflation. Particular attention is being paid to any signals from the Fed Chair regarding the possible path of monetary policy.
Reuters reported that while dollar weakness has provided short-term support to gold prices, the Federal Reserve’s monetary policy will remain the most significant factor determining the market’s long-term direction.
Source: Reuters.