Core Insights - The volatility of gold prices is likened to a roller coaster, with significant fluctuations observed since the beginning of 2025, causing anxiety among investors [1] - Historical patterns show that during times of financial tightening, such as in 2008 and 2013, gold prices can drop sharply despite initial expectations of a rise [3][5] - The relationship between the strength of the US dollar, fiscal health, and global liquidity is crucial in determining gold prices, with these factors acting like three horses pulling in different directions [8][14] Market Dynamics - In 2022, the tightening of monetary policy and the strengthening of the dollar led to a significant decline in gold prices, dropping from $2070 to $1620 [6] - The Federal Reserve's actions in 2025 are anticipated to be pivotal, with speculation around potential interest rate cuts influencing market sentiment [10][12] - The current economic environment lacks major liquidity crises, but the ongoing high fiscal deficit and internal government conflicts pose risks to market stability [10][16] Future Outlook - The second half of 2025 may see a major shift in market dynamics, influenced by Federal Reserve policy signals and fiscal adjustments, which could either bolster or depress gold prices [16][20] - Geopolitical uncertainties may also trigger a resurgence in gold's appeal as a safe-haven asset, depending on how these factors evolve [16][20] - Investors are advised to maintain a cautious approach, recognizing that the gold market is influenced by complex interrelations and not to be swayed by short-term price movements [18][20]

Group 1 - The core viewpoint of S&P Global Ratings is that the tariffs imposed by President Trump may help maintain U.S. fiscal health despite criticisms from mainstream economists [1] - S&P confirmed the U.S. long-term credit rating at AA+ and short-term rating at A-1+, with a stable outlook, partly due to expected tariff revenues offsetting the impact of recent tax and spending legislation [1][2] - The report indicates that significant tariff revenues are anticipated to counterbalance potential fiscal weaknesses arising from recent legislation, with July tariff revenues reaching a record high of $28 billion [2] Group 2 - There is ongoing debate among economists regarding the sustainability of tariff revenues, as Trump's policies aim to bring production back to the U.S., which could reduce future tariff income [2] - The Congressional Budget Office (CBO) estimates that recent budget legislation will increase the deficit by $3.4 trillion over the next decade, despite rising tariff revenues [2] - S&P's stable outlook suggests that while U.S. fiscal deficits may not significantly improve, they also will not worsen substantially in the coming years, with projected government net debt exceeding GDP by over 100% [3]