By:- Joseph Dahrieh, Managing Director at Tickmill
Gold prices retreated on Monday as investors adopted a cautious stance ahead of a crucial week for global monetary policy. A series of interest rate decisions from major central banks, including those in the United States, the euro area, the United Kingdom and Japan, are expected to provide important signals for financial markets. While interest rates are widely expected to remain unchanged, market attention will focus on forward guidance and policymakers’ assessment of inflation risks.
Rising geopolitical tensions in the Middle East continue to drive gold prices. Higher oil prices continue to fuel global inflation concerns. The latter could push central banks toward a more cautious monetary policy, potentially supporting bond yields and limiting gold’s upside potential in the near term.
At the same time, persistent instability in Eastern Europe continues to reinforce gold’s safe-haven appeal, as the prospect of a ceasefire appears increasingly distant. Structural demand also remains supportive. Central banks have maintained steady purchases in recent quarters, reflecting a broader shift toward diversifying reserves.
