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Gold at ATH, ECB cuts rates
Gold prices pushed through the $2700 resistance to claim $2714 a new record high on market uncertainty
ECB: The ECB cut rates for the second straight meeting, its first back-to-back cuts in 13 years, to tackle slowing inflation and growth.
USD: Strong U.S. retail sales and lower-than-expected jobless claims boosted the dollar, lifting the Dollar Index above its 200-day moving average.
Inflation Forecast: The ECB adjusted its inflation outlook, aiming for 2% "in the course of" 2025, signaling potential for further rate cuts if economic data doesn't improve.
Gold
Gold prices surged to a record high during Asian trading on Friday, driven by safe-haven demand as the U.S. presidential election draws near. Additionally, the European Central Bank's interest rate cut provided further support.
Prices claimed $2714 for the first time as market uncertainties increase towards the elections, rate cuts and tensions in the Middle East.
ECB
The European Central Bank cut interest rates by a quarter point for the second consecutive meeting on Thursday, as policymakers seek to combat sluggish inflation and economic growth. This marks the first back-to-back rate reduction in 13 years and signals a shift away from a period of rate hikes aimed at curbing high inflation.
The ECB is now refocusing its policy on stimulating the struggling Eurozone economy, which has lagged behind the U.S. for much of the past two years.
USD
U.S. retail sales data and a drop in jobless claims to 241k, beating the forecast of 260k supported the dollar especially as investors opt for more safe haven demand amid market uncertainties Additionally, the Philly Fed report exceeded expectations. As a result, the Dollar Index climbed from a low of 103.44 to a high of 103.87, moving above its 200-day moving average.
