Gold hits new record

Gold prices top expectations after Powells speech and the euro gets a boost ahead of ECB decision.

By Nadia Elbilassy | @Nadia Elbilassy | 7 March 2024

Market open
  • Gold prices surged to new records, marking a seventh consecutive daily increase, driven by Jerome Powell's hints at potential rate cuts based on easing inflation.

  • The yen reached a one-month peak against the dollar

  • Euro remained near $1.089 after a 1% overnight rise to 1.0949; potential ECB rate cut discussions may impact the euro's positive momentum.

On the Market Watch:

In commodities, gold prices surged to achieve new records on Thursday, marking their seventh consecutive daily increase. After Federal Reserve Chair Jerome Powell's hints at potential rate cuts in the upcoming months, contingent on a possible easing of inflation.

Spot gold rose to $2,159.79 per ounce, after hitting an unprecedented high of $2,161.09 earlier in the session.

Despite Federal Reserve Chair Jerome Powell's statement that the bank plans to eventually cut interest rates in 2024, he emphasized the need for more confidence in the reduction of inflation. This sentiment was echoed by Minneapolis Fed President Neel Kashkari, who separately mentioned that he did not anticipate the Fed making more than two rate cuts in the current year.

In Wall Street, U.S. stock indices steadied in the green however ongoing uncertainty regarding the extent and magnitude of the Federal Reserve's intended interest rate cuts weighed.

In currencies, the euro hovered near $1.089 after rising 1% overnight to 1.0949. Hawkish remarks regarding rate cuts from the ECB could sustain the euros positive momentum.

The yen reached a one-month peak against the dollar amid increasing speculation that the Bank of Japan might abandon negative interest rates this month. Concurrently, the greenback faced pressure as expectations of U.S. rate cuts by mid-year gained traction.

The Japanese currency surged over 0.5%, reaching a high of 148.40 against the dollar