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Cailianshe News, July 17 (Reporter Wang Hong)Today, the gold price broke through the $2,470/ounce mark. After the correction in June, the gold price now stands at $2,400/ounce, and today it hits a new record high. From mid-March to mid-May, the gold price has repeatedly hit new record highs. Experts believe that the rise in gold prices is affected by factors such as the decline in the US dollar index, geopolitical risks and rising risk aversion in the market.

Whether the Fed cuts interest rates in September will have an impact on gold prices. Analysts predict that gold, as a non-interest-bearing asset, will benefit from the rate cut and is expected to rise to $2,600/ounce by the end of the year. Analysts also said that if the gold price breaks through the 2,480 resistance level, the maximum increase could be $2,660. However, some experts pointed out that although the long-term gold price is bullish, it is currently overvalued and the possibility of a correction to $2,000/ounce cannot be ruled out.

Breaking through $2,478, gold price hits new high

On July 17, gold prices hit a new record high. The London spot gold price closed above the $2,478/ounce mark, breaking the high set at the end of May and opening at $2,482.24/ounce. Shenyin Wanguo said that recently, with the continued slowdown in US employment data and lower-than-expected inflation in June, international gold prices hit a new high.

Gold prices began to soar in early March this year, hitting a staged high of $2,135 per ounce on March 7, and then broke through $2,401.5 per ounce on April 12 before starting to fall back. Subsequently, gold prices weakened in June due to multiple factors, falling below $2,300 per ounce at one point.

However, many industry analysts predict that the price of gold will likely rise in the medium and long term. In early April, some analysts predicted that the price of gold would exceed $2,400 per ounce.CICCWhen looking forward to the trend of major asset classes in the second half of the year on June 11, it was pointed out that the price of gold is expected to climb to $2,400 per ounce. Now gold has stabilized at $2,400 per ounce.

The World Gold Council pointed out on July 11 that gold prices hit record highs several times between mid-March and mid-May. Gold prices have risen 12% year-to-date, and for most of the second quarter, gold prices were above $2,300 per ounce.

"One of the main reasons for the record high gold prices is the decline in the U.S. dollar index, because the gold price and the U.S. dollar index have shown a seesaw relationship most of the time. Recently, the U.S. dollar index has declined and the gold price has risen significantly. In addition, the U.S. election has also caused a certain amount of market panic and risk aversion demand. Global geopolitical risks remain high. A series of factors have worked together to push up gold prices," Zhao Qingming, deputy director of the Huiguan Information Technology Research Institute, told Cailianshe reporters.

Gold price expected to rise to $2,600 by the end of the year

The current market focus is on whether the Federal Reserve will cut interest rates in September, which will have an important impact on gold prices.

UBSThe Office of the Chief Investment Officer of Wealth Management pointed out that since March this year, some developed economies have begun to cut interest rates. Although the United States missed the interest rate cut wave in the first half of the year, the inflation rate has shown a clear downward trend in recent months. The core CPI in June increased by only 0.1% month-on-month. The market expects that the possibility of a rate cut in September has increased from about 70% before the release of the CPI data to about 90%.

"As a non-interest-bearing asset, gold will benefit from interest rate cuts. It is also one of the best tools to hedge against uncertainties such as the US election, geopolitics, and the US deficit," said the office of the chief investment officer of UBS Wealth Management. Continued buying by central banks will also support gold prices, which are expected to rise to $2,600 an ounce by the end of the year.

Wang Yi, an analyst at Guohua Gold, told Cailianshe that spot gold has gained support against the backdrop of a falling dollar. As for whether gold prices can rise further and break through the flag pattern, the key lies in whether the U.S. dollar index can break through the 104 level and the possibility of the Fed's interest rate cut in September. Since the flag pattern in the gold daily chart is developing upward, the resistance level has extended to $2,480.

"The Federal Reserve is expected to cut interest rates from September to December. If the gold price breaks through $2,480, it will open up new room for growth. According to the upward breakthrough extension ratio, the maximum increase in gold prices can be seen to $2,660, and the first condition is to break through the 2,480 resistance level," Wang Yi predicted.

However, some analysts are cautious about $2,600, believing that the gold price is already overvalued this year. Zhao Qingming believes that looking back at history, the gold price is already overvalued. It is more likely to exceed $2,500/ounce this year, and it is doubtful that it will reach $2,600/ounce. At the same time, it is not ruled out that the gold price will be affected and fall back to $2,000/ounce.

"Looking ahead, considering geopolitical risks and continued quantitative easing by major central banks around the world, the general trend of gold prices is still upward. But this rise will not be smooth and all the way up. There should be certain fluctuations, and even a significant correction at some stage," said Zhao Qingming.