Gold Holds Firm Near $5,000 as Fed Split and Middle East Risk Lift Safe-Haven Demand

Core Viewpoint - The gold market experienced significant price fluctuations over the past week, with spot prices moving within a range exceeding $150/oz, yet this period is viewed as a healthy consolidation at elevated price levels [3]. Market Activity - Trading volumes were notably lower on Monday due to the US President's Day holiday, resulting in minimal activity across American trade desks [4]. - A consensus to resume liquidation trends led to downward pressure on gold prices, which fell to a weekly low near $4,860/oz [5]. - Following the low point, the return of US desks brought renewed investor interest, leading to a rally in gold prices that pushed them back above $5,000 [6]. Influencing Factors - Anticipation of upcoming macroeconomic data contributed to expectations that the Federal Open Market Committee (FOMC) might lower interest rates sooner, supporting gold prices [7]. - The release of Fed meeting minutes indicated a split committee, maintaining rate-cut expectations and providing support for gold around the $5,000 level [8]. - Rising geopolitical risks prompted a risk-off sentiment late in the week, further lifting gold prices above $5,000 and towards a potential close of approximately $5,100 [8]. - Weak Q4 GDP data and a Supreme Court ruling against the Trump tariff strategy may shift focus to Federal Reserve communications and White House messaging in the upcoming week [8].