29th November 2024 Gold prices stabilized to a certain extent after a volatile month. The market reacted to recent U.S. economic data, which points to persistent inflation and suggests that the Federal Reserve may adopt a cautious approach to future rate cuts.

October’s consumer spending slightly exceeded expectations, indicating a potentially resilient economy. However, progress in curbing inflation has stalled in recent months, raising concerns about the Fed’s ability to adjust its monetary policy further. Compounding these challenges is the prospect of higher tariffs under the incoming Trump administration, which could constrain the Fed’s flexibility to enact additional rate cuts next year. Although a December rate cut is still expected, the Fed could reassess its approach as it moves into 2025.

Meanwhile, President-elect Donald Trump’s proposed tariffs on imports from Mexico, Canada, and China, alongside escalating geopolitical risks in Eastern Europe, could increase gold’s appeal as a safe-haven asset. Trade policy uncertainties and global tensions could remain key factors for reinforcing demand for gold and could provide continued support to the precious metal over the medium term.