Gold Price News: Significant rise after ECB interest rate cut

The price of gold rose sharply on September 12, 2024 to USD 2,558.79 per troy ounce. This price increase directly follows the European Central Bank's decision to cut interest rates by 25 basis points. This interest rate cut, which was expected in advance, leads to a devaluation of the euro and makes gold more attractive for investors.

The US consumer price index (CPI) data published at the same time exceeded expectations and signaled continued inflationary pressure in the world's largest economy. This data increased the demand for gold as a hedge against inflation, as higher inflation rates generally affect the purchasing power of currencies. Investors reacted accordingly by increasing their gold holdings.

Analysts agree that the combination of the ECB interest rate cut and the higher US inflation data will continue to drive the rally in the gold market. The appeal of gold as a hedge against inflation risks and currency devaluations remains strong. Experts also see a connection with the continuing weak global economic data, which is affecting investor confidence in traditional asset classes such as equities.

Gold continues to perform exceptionally well compared to equities and bonds. While many stock markets are under pressure due to global uncertainties, gold continues to hold its own as a stable investment. Bonds also offer limited returns due to low interest rates, which makes gold even more attractive.

Market observers assume that the price of gold could continue to rise in the short term. This is particularly true if global inflation continues and central banks maintain their low interest rate policies. Investors are advised to hold their gold positions in a diversified portfolio to hedge against further economic uncertainties. Further monetary policy decisions by the Fed and ECB could have an additional impact on the gold market in the coming weeks.