On Tuesday (October 29th), gold prices remained stable near historical highs as traders prepared for the release of key economic data that will help set the foundation for the Federal Reserve's next policy decision, while the countdown to the U.S. presidential election continues.
As investors await the release of inflation and employment reports this week, gold prices climbed above $2,755.
The October non-farm report is expected to show the underlying resilience of the economy, while the labor market may experience minor fluctuations due to potential impacts on job growth from two hurricanes.
U.S. job vacancies for September and consumer confidence data for October will be released later today, potentially providing more clues about the health of the world's largest economy.
The Federal Reserve will announce its interest rate decision during a two-day meeting starting on November 6th. Employment and inflation data may influence the Fed's decision.
Economists still expect policymakers to cut interest rates by 0.25 percentage points at the November meeting. Lower borrowing costs are generally unfavorable for non-yielding gold.
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According to the CME's FedWatch Tool, the market estimates a 98% chance of the Federal Reserve lowering interest rates by 25 basis points.
Gold prices have risen by about one-third this year, reaching a historical high last week, close to $2,760, supported by central bank purchases and ongoing safe-haven demand.
In terms of geopolitics, two security sector sources and the mayor of Baalbek told Reuters that an Israeli attack on the eastern Bekaa Valley in Lebanon resulted in at least 60 deaths and dozens of injuries.
Fund managers also played a role, with hedge funds increasing their net long positions in gold, and investors also increasing their gold holdings in exchange-traded funds (ETFs).In terms of physical goods, according to the latest statistical data from the China Gold Association, China's gold consumption decreased by 11.2% year-on-year in the first three quarters of 2024, as high prices have suppressed demand for jewelry.
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