On Wednesday (October 30th), in the Asian morning session, spot gold continued its upward trend, with the gold price just touching $2,779.88 per ounce, setting a new historical high. Analysts said that tensions in the Middle East provided upward momentum for gold prices.
The latest news from the Middle East reported that Israel launched an attack on a residential building in Beit Lahia, a northern town in Gaza, on Tuesday, resulting in at least 93 Palestinians dead or missing. The United States called it a "terrible event."
According to Bloomberg in the United States, in the Asian morning trading on Wednesday, gold prices reached a record level, and traders are digesting the latest U.S. economic data and weighing potential market turmoil.
The market is weighing a report showing that U.S. job vacancies have dropped to the lowest level since early 2021. This data contrasts with the data from September, which showed that the job market remained strong, prompting traders to reduce bets on the Federal Reserve making another significant rate cut. Higher borrowing costs are generally unfavorable for precious metals.
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In terms of data on Tuesday, the number of job vacancies in the United States' September Job Openings and Labor Turnover Survey (JOLTS) fell from 7.86 million in the previous month to 7.44 million, reaching the lowest level in three and a half years, far below the expected 7.99 million. The data indicates a decline in labor demand, with businesses waiting for the economy to accelerate. This is the fewest number of job vacancies since January 2021.
The JOLTS job vacancy report is one of the labor market indicators that U.S. Treasury Secretary Yellen valued the most when she was the chair of the Federal Reserve. This indicator is also a labor market data that the Federal Reserve highly focuses on.
Before the Federal Reserve holds its next policy meeting on November 6th and 7th, traders will closely monitor more U.S. economic data to be released later this week, including inflation and employment data, which may provide clues for the Federal Reserve's easy policy trajectory before 2025. Economists expect that the Federal Reserve will cut interest rates by 25 basis points next week.
Since gold does not generate interest, it can thrive more in a low-interest-rate environment and is considered a means of hedging market volatility.The Israeli side did not immediately comment. The Israeli military often questions the death tolls announced by Hamas media offices, claiming that these numbers are frequently exaggerated.
Supported by central bank buying and safe-haven demand triggered by the Middle East, gold has soared by over 34% this year.
On Tuesday, gold prices showed a clear upward trend, breaking through $2,758.40 per ounce and attempting to maintain above that level, which implies that gold prices will halt the previously anticipated corrective bearish scenario and resume the main bullish trend.
Economies.com noted that with gold prices closing above $2,758.40 per ounce on Tuesday, this will push gold prices higher to the next bullish target of $2,783.00 per ounce.
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