Daily Digest Market Movers: Gold price continues to draw support from a combination of factors

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  • A projectile crossing from Lebanon fell in an open area in central Israel, while the latter warned of more attacks on Hezbollah after targeting the Iran-backed group's financial operations. 
  • The European Central Bank last week lowered interest rates for the third time this year – marking the first back-to-back rate cut in 13 years – and eyes more cuts amid an economic downturn.
  • Weak inflation data from the UK solidified bets for more aggressive rate cuts by the Bank of England and the Federal Reserve is also anticipated to lower borrowing costs further.
  • Opinion polls indicate that Vice President Kamala Harris and former President Donald Trump remain locked in a close contest as the November 5 US Presidential election approaches. 
  • Meanwhile, increasing concerns that Donald Trump's win could see the launch of further potentially inflation-generating tariffs triggered the overnight selloff in US government debt.
  • Moreover, the markets have fully priced out the possibility of another jumbo interest rate cut by the Fed in November, lifting the US Treasury bond yields to nearly three-month highs.
  • The US Dollar preserves its recent strong gains to the highest level since early August, albeit does little to dent the underlying strong bullish sentiment surrounding the Gold price.
  • Traders now look to the release of the Richmond Manufacturing Index, which, along with Philadelphia Fed President Patrick Harker's speech, might provide some impetus to the XAU/USD.

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