Gold prices (XAU/USD) eased slightly from the $2,758-$2,759 region, marking the highest level since November 1, but remained in positive territory for a third consecutive day as of Wednesday’s early European session. The slight pullback came amid an upbeat market mood, alongside a rebound in US Treasury bond yields and a modest recovery in the US Dollar (USD) from a two-week low. These factors served as headwinds for the precious metal.
Despite this, market expectations that the Federal Reserve (Fed) may cut interest rates twice this year could help keep US bond yields and the USD in check, thus continuing to support demand for gold. Additionally, concerns surrounding US President Donald Trump’s proposed tariffs are likely to drive further haven demand, offering a solid foundation for gold’s continued upward trend, which has now extended for over a month.
In summary, while short-term fluctuations may occur, gold’s appeal as a safe-haven asset appears strong, buoyed by economic uncertainty and potential monetary policy shifts.
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