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Gold prices surged over 2% on Monday, with investors becoming more optimistic about a potential Federal Reserve rate cut at the December meeting. The rally was fueled by increased bets on a reduction in interest rates by the central bank, which is expected to impact the global economy and the value of the US dollar.
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The increase in gold prices was also driven by news of a possible reopening of the US government, which initially pushed the Greenback higher. However, investors remain skeptical about the potential for earlier gains, preferring to wait and see how events unfold.
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According to market analysts, the recent increase in gold prices is largely attributed to the persistent expectation of a rate cut by the Federal Reserve. This anticipation has led to a decrease in yields on 10-year Treasury notes, making gold more attractive as an investment option.
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The impact of a potential Fed rate cut on the US economy and the global financial markets remains uncertain. However, investors are taking a cautious approach, preferring to wait for concrete evidence before making any major decisions.
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In terms of technical analysis, gold prices have been trending upwards over the past few weeks, with support levels at around $1,850 per ounce. This upward trend has been driven by a combination of factors, including rising inflation and concerns about the impact of trade policies on global growth.
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Moving forward, investors will be keeping a close eye on developments related to the US government shutdown and the potential for a Fed rate cut. As these events unfold, gold prices are likely to continue to fluctuate based on market sentiment and economic data.
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Key points:
• Gold prices surged over 2% on Monday due to increased bets on a Federal Reserve rate cut.
• The rally was driven by persistent expectations of a rate cut and decreased yields on 10-year Treasury notes.
• Investors remain cautious, preferring to wait for concrete evidence before making major decisions.
• Gold prices have been trending upwards over the past few weeks, with support levels at around $1,850 per ounce.
