Gold Prices Near $4,150 per Ounce

SadaNews - Gold fluctuated as traders assessed the growing chances of an interest rate cut in the United States against the possibility of reaching a peace agreement in Ukraine.

The precious metal traded near $4,157 per ounce after finishing the previous session with little change. Recent economic data bolstered bets that the Federal Reserve will cut interest rates at its next meeting.

A slight uptick in retail sales for September indicated that several months of strong spending were beginning to lose momentum, while consumer confidence this month recorded its biggest drop since April.

Hopes for an interest rate cut were strengthened after the White House's National Economic Council Director Kevin Hassett emerged as the front-runner to head the Federal Reserve, particularly as he shares President Donald Trump's support for lowering borrowing costs, according to a Bloomberg report.

Gold typically benefits when interest rates are low as it does not yield interest, whereas swap traders now see an over 80% chance of a quarter-point cut in December.

Interest Rate Predictions and the Impact of Geopolitical Developments

Hebi Chen, an analyst at Vantage Markets in Melbourne, stated that the next Fed decision has become "the real Pandora's box of risks this year (which could lead to a series of unexpected reactions), and this is likely to continue until 2026."

She added, "In the absence of a strong economic link to validate expectations, any optimism remains fragile, and recent volatility in stocks and cryptocurrencies shows how quickly sentiment can shift."

Gold's gains slipped slightly after ABC News reported that Ukrainian officials agreed to a plan to end the war with Russia. Ending the long-standing conflict could weaken demand for safe-haven assets.

Gold fell from a peak above $4,380 per ounce last month, but it has maintained its hold above the $4,000 level.

The metal, which is on track for its best annual performance since 1979, is up over 55% this year, bolstered by central bank purchases and strong inflows from investors driven by what is known as "currency devaluation" trading.

Gold rose 0.1% to $4,135.73 per ounce by 8:52 AM Singapore time. The Bloomberg Dollar Index steadied after finishing the previous session down by 0.3%. Silver fell by 0.2%. Platinum and palladium also declined.