Gold remained steady in spot transactions at $4,023.44 per ounce, after experiencing a drop to $3,988.37 earlier in the session. The precious metal has surged approximately 4% this month. Meanwhile, U.S. gold futures for December delivery settled at $4,016.10 per ounce.
Regarding price trends, Morgan Stanley stated on Friday that gold prices are poised to rise to $4,500 per ounce by mid-2026, driven by increased actual demand from exchange-traded funds (ETFs) and central banks amid ongoing global economic uncertainty.
The Federal Reserve had cut the interest rate by a quarter point on Wednesday for the second time this year, bringing the target range for federal funds rate between 3.75% and 4%. Gold, which does not yield returns, benefits from a low-interest-rate environment and periods of economic uncertainty, as it is viewed as a safe haven during volatility.
According to the CME Group's FedWatch tool, markets expect a 74.8% chance of a 25 basis point rate cut in the upcoming December meeting, compared to a 91.1% probability a week prior, following comments from Fed Chair Jerome Powell that reduced the likelihood of further cuts this year.
Meanwhile, the dollar index remained near its highest levels in three months against a basket of currencies, making gold more expensive for holders of other currencies.
On the trade front, U.S. President Donald Trump announced on Thursday that he reached an agreement with Chinese President Xi Jinping to reduce tariffs on China in exchange for Beijing combating illegal fentanyl trade and resuming purchases of U.S. soybeans while maintaining the flow of rare earth metal exports.
As for other precious metals, silver stabilized at $48.92 per ounce in spot transactions, while platinum rose by 0.2% to $1,613.50, and palladium increased by 2.1% to $1,474.51.