Gold is holding positive ground around US$3,750 in early Asian trade on Friday, supported by expectations of further US rate cuts and a backdrop of ongoing geopolitical risks.
The Federal Reserve’s decision earlier this month to trim its benchmark rate by 25 basis points has kept momentum behind the precious metal. Traders are now pricing in the likelihood of at least two more cuts before year-end, with lower rates generally seen as reducing the opportunity cost of holding non-yielding assets like gold.
At the same time, mixed signals from Fed officials are tempering enthusiasm. While Chair Jerome Powell has stressed the importance of incoming economic data, Governor Stephen Miran argued for a sharper 0.50% cut, pointing to inflation moving closer to the Fed’s 2% target. That divergence has markets on edge, awaiting the release of the US PCE inflation data later today, widely viewed as the Fed’s preferred inflation gauge.
While the near-term outlook hinges on Friday’s data, the bigger picture remains one of gold’s enduring appeal as a store of value. Investors seeking diversification away from traditional markets often look to precious metals to balance risk, particularly during periods of policy uncertainty.
For Australian investors, physical gold and silver can also be accessed through digital, fully backed tokens such as the Gold Standard (AUS) and Silver Standard (AGS), bringing together the stability of metals with the flexibility of blockchain.
With central banks still navigating an uneven global landscape, gold’s position near US$3,750 underscores why it continues to play a central role in both traditional and modern portfolios.
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