As September begins, gold is facing a familiar challenge — the month is historically marked by price declines.
September is also typically the worst month for US stocks, but a strong month for the American dollar.
This pattern has raised concerns among investors and analysts alike, who are debating whether the factors that have bolstered gold throughout 2024 will be able to counteract its typical seasonal weakness.
Expectations that the US Federal Reserve will cut interest rates have also boosted gold. Anticipation of these cuts has bolstered its price by reducing the appeal of the US dollar, which traditionally has an inverse relationship with gold.
With that said, gold isn’t guaranteed to go down — the news outlet states that using a timeframe of three decades gold has actually risen in September. And there are a number of other factors that could help it sustain high levels.
As September continues, the question remains whether this and other supportive factors will be enough to offset the historical trend of declines. The outcome of the Fed’s meeting later this month, alongside geopolitical developments, will likely play a crucial role in determining whether gold can break the “September curse” this year.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
Leave a Reply