Gold Price News: US inflation data and Middle East tensions keep the market on tenterhooks

On October 7, 2024, the price of gold is USD 2,650 per troy ounce, after strong US labor market data on Friday put pressure on the market. The 254,000 new jobs and the drop in the unemployment rate to 4.1% strengthened the US dollar, which pushed down the gold price in the short term. The market expects the publication of US inflation data in the next few days, which will be crucial for the Federal Reserve's future interest rate policy.

The consolidation of the gold price in a narrow range between USD 2,630 and USD 2,670 indicates that investors are adopting a wait-and-see attitude. If the inflation figures are strong, this could reduce the likelihood of interest rate cuts and further weigh on the gold price. On the other hand, a weaker level of inflation could drive the price higher.

In the Middle East, tensions continue to mount. Israel is conducting intensive military operations against Iran-backed forces in Lebanon and Gaza, which has led to a new escalation of the situation. Iran has threatened retaliation, and regional instability is increasing demand for gold as a safe haven.

The Ukraine conflict has also intensified, with Russian forces launching a large-scale offensive in eastern Ukraine. These geopolitical crises are further fueling market uncertainty and supporting the stability of the gold price. Analysts expect these geopolitical risks to play a key role in price developments in the coming weeks.

Central banks around the world, particularly in emerging markets such as China and India, have continued to increase their gold reserves, which supports the gold price in the long term. These purchases are a reaction to the uncertainties in the global financial system and the high volatility in the stock and currency markets. This gives the gold price a solid foundation and protects it from more severe declines.

Gold prices are expected to remain volatile this week as attention turns to US inflation data and geopolitical developments. Should gold prices break the resistance at $2,670, they could rise to USD 2,700. Otherwise, a drop to USD 2,630 or below could follow. Investors should keep a close eye on both macroeconomic data and geopolitical tensions.