Gold Streak: Fourth Week of Gains Likely

24 Jan 2025 , 10:08 AM

On Friday, gold prices increased marginally and were headed for a fourth consecutive weekly gain as demand for the safe-haven asset increased due to uncertainty surrounding U.S. President Donald Trump’s trade policies.

Spot gold gained more than 2% this week and increased by 0.2% to $2,760.40 an ounce. At $2,767.60, U.S. gold futures increased 0.1%.

As investors awaited a round of policy announcements from global central banks, Trump’s remarks calling for an immediate cut in interest rates without providing clarity on tariffs caused the dollar to decline throughout Thursday’s bumpy session.

Following a two-day meeting on Friday, it is generally anticipated that the Bank of Japan would hike interest rates. The European Central Bank (ECB) and the U.S. Federal Reserve are expected to make rate decisions on Thursday and Wednesday of next week, respectively.

The CME Group’s FedWatch Tool indicates that traders have a 99.5% chance of the Fed maintaining rates at its meeting on January 28–29. The allure of the non-yielding bullion is diminished by higher rates.

If Trump’s inflationary policies cause the Fed to keep interest rates higher for longer, gold’s allure as an inflation hedge may be lessened.

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