Gold’s rally has shown little sign of slowing in the past few days, even as futures for the precious metal hit their 33rd intraday high this year on Oct.
Gold prices may not reach a ceiling anytime soon, said Michael Armbruster, co-founder and managing partner at Altavest.
“The trend is up and the main drivers of gold prices remain unchanged — including out-of-control federal spending, which will eventually force the Federal Reserve to devalue the dollar,” Armbruster told MarketWatch.
"Foreign demand remains strong and we are likely to hear more from the BRICS about their de-dollarization plans. Western investors have been slow to embrace gold and if that changes, it could push gold prices higher," Armbruster said.
Gold has hit a record intraday high 33 times so far this year, the most in a calendar year since 2011, when there were 38 record highs, according to Dow Jones Market Data.
Gold is “climbing against all paper currencies, not just the dollar,” said Colin Cieszynski, portfolio manager and chief market strategist at SIA Wealth Management.
The precious metal was also supported by the European Central Bank's interest rate cut, "which reminded people that most major central banks have gone into easing mode, not just the Fed," Cieszynski pointed out.
The ECB cut its key interest rate by 25 basis points to 3.25%. The rate cut “contributes to the belief that most central banks are on a prolonged easing path,” said Peter Grant, vice president and senior metals strategist at Zaner Metals, adding that lower interest rates are supporting gold.
Meanwhile, U.S. economic data released on Oct. 17 was mixed. Better-than-expected retail sales and the Philadelphia Fed manufacturing index were offset to some extent by weaker-than-expected industrial output, Grant told MarketWatch.
Gold prices fell shortly after retail sales data showed a 0.4% increase in September, and rebounded after industrial output fell 0.3% in September.
Grant said the gold uptrend looks strong and he forecasts gold prices could continue to rise through the end of 2024. “I continue to be impressed by gold’s resilience to the recent rally in the US dollar,” Grant said.
