Gold prices held steady on Monday as traders prepared for two major events that could sway the market — the US presidential election and the Federal Reserve’s interest rate decision later in the week.
Spot gold is currently flat at US$2,736.16 per ounce, as it continues to attract safe-haven interest.
With voting set to begin on Tuesday US time, analysts suggest that a Trump win could lift gold prices towards US$2,900 — his economic approach is seen as more likely to drive inflation. In contrast, a Harris victory may trigger a temporary dip in gold’s value as markets adjust to expectations of policy stability.
The Fed’s anticipated 0.25% rate cut on Thursday (largely already priced in) could play a role in setting gold’s direction. Yields would likely fall in response to a reduction, boosting gold’s attraction as a store of value in comparison to fixed-income investments.
Meanwhile, the US dollar has weakened, hitting a two-week low and making gold more affordable for international buyers.
The dollar index is down 0.43% to 103.83, while Treasury yields have also fallen.