(CTN News) – Gold prices remained stable on Friday as they approached the end of their strongest year since 2020, trading comfortably above $2,000 per ounce. This positive trend was supported by the anticipation of a potential interest rate cut by the U.S. Federal Reserve in March.
At 10:25 a.m. ET (1525 GMT), spot gold steadied at $2,061.89 per ounce. However, U.S. gold futures experienced a slight decline of 0.6% to $2,071.10.
Throughout the year, bullion has witnessed a 13% increase, with prices fluctuating between lows near $1,800 and reaching a record high of $2,135.40.
Intesa Sanpaolo economist Daniela Corsini highlighted the volatility of gold in 2023, attributing it to unexpected crises such as the banking crisis in March and the Hamas attack on Israel in October.
These events triggered significant price rallies and pushed gold to new records.
Looking ahead to the next year, gold investors are optimistic about the potential for record-high prices. Factors such as a dovish shift in U.S. interest rates, ongoing geopolitical risks, and central bank buying are expected to provide support to the market.
UBS analyst Giovanni Staunovo emphasized that stronger demand from investors, particularly an increase in ETF inflows, is necessary to see higher levels in gold prices.
This would require weaker U.S. economic data and lower inflation, prompting a more dovish stance from the Federal Reserve.
The dollar’s value is expected to decrease by more than 2% in 2023, and the yields on 10-year Treasury bonds are at their lowest levels since July.
The price of spot silver has fallen by 0.4% to $23.83 per ounce, resulting in a 0.5% decline for the year. Despite the potential risks of a slowdown or mild recession in the U.S., there is optimism about industrial demand for silver, according to Philip Newman, the Managing Director of Metals Focus.
Platinum has also experienced a slight decrease of 0.1% to $1,001.21, while palladium has dropped by 2.4% to $1,105.72. Both metals are on track for a yearly decline, with palladium experiencing its largest drop since 2008 at around 38%.
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