By Ashitha Shivaprasad
(Reuters) – Gold prices firmed on Wednesday and was a whisker away from the record high amid prospects of monetary policy easing globally and geopolitical risks, while investors also awaited U.S. economic data to gauge the Federal Reserve’s rate-cut trajectory.
Spot gold rose 0.5% to $2,674.38 per ounce by 0718 GMT and was $11 shy of the all-time high level hit last month. U.S. gold futures gained 0.5% to $2,690.90.
“The game changer for gold is monetary policy easing as it sets the stage for investment demand. The uncertainty surrounding U.S. elections and geopolitical tensions is also supporting prices,” said ANZ commodity strategist Soni Kumari. [US/]
In the short term weak data could push gold prices above $2,700, while prices could reach $2,900 by next year, Kumari said.
Spot gold looks poised to revisit its Sept. 26 high of $2,685 as it has broken resistance at $2,666, according to Reuters technical analyst Wang Tao.
Gold is expected to rise to $2,941 over the next 12 months, delegates to the London Bullion Market Association’s annual gathering predicted on Tuesday.
Investors are looking forward to U.S. retail sales, industrial production and weekly jobless claims data, all due Thursday.
Traders are currently pricing in a 97.2% chance of a 25-basis-point Fed rate cut in November.
San Francisco Fed’s Mary Daly said the central bank remains on track for more cuts this year. Atlanta Fed President Raphael Bostic said he pencilled in just one more 25-bp reduction this year.
Elsewhere, data showed that British inflation dropped sharply, bolstering bets on a rate cut next month by the Bank of England.
Zero-yielding bullion tends to be a preferred investment in a low interest rate environment and during geopolitical turmoil.
Spot silver firmed 0.8% to $31.72. Platinum rose 1.4% to $997.71 and palladium climbed 0.7% to $1,016.25.
(Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Rashmi Aich, Subhranshu Sahu and Eileen Soreng)
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