During the week of March 3-7, the spot gold price on the world market experienced many fluctuations, continuously recovering after falling from a historical peak of over 2,950 USD/ounce to 2,830 USD/ounce on February 28.

However, selling pressure increased during the recovery sessions. The $2,900/ounce mark was repeatedly tested. Gold adjusted strongly around this threshold throughout the week, closing the weekend session at $2,911/ounce.

Profit-taking followed a long streak of gold gains, sparked by US economic data showing higher-than-expected inflation, dampening expectations of an early interest rate cut by the US Federal Reserve (Fed).

However, in the last session of the week, March 6, the spot gold price rebounded and at times reached about 2,935 USD/ounce, up about 50 USD compared to the bottom of the week.

This reversal was driven by increased safe-haven demand as geopolitical tensions escalated, especially from the Russia-Ukraine conflict; increased tensions within the US, especially between advisor Elon Musk and some members of the US government; and uncertainty over US trade policy under Donald Trump.

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Gold prices are expected to fluctuate strongly in the new week. Photo: BT

Reports of Russia stepping up military attacks, while the US imposed more tariffs on several trading partners, have raised concerns about global economic instability, sending investors flocking to gold as a safe haven.

Moreover, a strong weakening of the US dollar and falling US bond yields also supported the gains.

The DXY index, which measures the US dollar against a basket of six major currencies, fell sharply from nearly 107 at the start of the week to 103.73 at the end of the week. Gold, like many other commodities, is priced in US dollars and therefore tends to move inversely to the US currency.

Gold ETFs also recorded a slight increase in cash flow, showing the return of institutional investors.

However, analysts warn that profit-taking pressure may still be high whenever gold prices increase. Macroeconomic fluctuations pose many risks to precious metals. Without additional supporting factors, gold may face the risk of correction before returning to challenge the psychological mark of $3,000/ounce as many large organizations such as Goldman Sachs and JP Morgan have commented.

US financial giants have optimistic forecasts for gold in 2025, with the possibility of reaching $3,100 by the end of the year.

There are a number of factors that could influence gold prices during the week of March 10-14. One is the US CPI report on March 12. If inflation is higher than expected, the Fed may delay cutting interest rates, putting pressure on gold. Conversely, lower inflation could support gold prices. Next week, Fed officials will make several statements. Any signal on interest rates could affect gold prices.

After last week’s decline, the US dollar could rebound in the new week, which could put downward pressure on gold, while higher US bond yields tend to make gold less attractive.

Investors are also watching the geopolitical situation in the Middle East and Ukraine. Escalating tensions could boost demand for gold as a safe-haven asset. In addition, there is a trend of gold purchases by central banks and gold ETFs.

Movements in the stock and cryptocurrency markets will also impact gold. If these markets decline slightly, money tends to flow into gold, but sharp declines tend to have a negative impact on the precious metal.

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