Gold is rising significantly during the trades, so what are the reasons!

 Today's transactions witnessed a clear rise in gold prices, thus abandoning the relative decline that the yellow metal witnessed during early trading, in light of the growing prospects of a possible global economic recession.

On the margin of trading, spot gold contract prices grew by approximately 0.24% to reach USD 1790 per ounce, in addition to an increase in gold futures contract prices to approximately USD 1802 per ounce, and silver contract prices rose by about 1.64% to 23.2 dollars per ounce.

The reasons for the recovery of demand for gold during trading

The recovery of gold prices is due to the decline in the US dollar index during today's trading, where the index fell by 0.26% to settle near the level of 104.84 points, which boosted gold's gains during trading.

Most often, the decline in the US dollar results in a decrease in the cost of gold, from the point of view of investors holding other investment havens, which leads to an increase in demand for the yellow metal.

The release of US unemployment benefits data had a clear impact on the high demand for gold; the data showed the growth of applications for unemployment benefits by 230 thousand new applications, and this volume is larger compared to the previous revised reading, which reached 226 thousand applications last week.

This reinforced market expect

ations that the US Federal Reserve will slow down the pace of interest rate hikes by only 50 basis points at its next meeting, which led to a decline in the US dollar, and then a rise in gold.

It is worth noting that expectations about the recovery of economic growth in China are growing, and it is the largest producer and consumer of gold metal in the world that had a strong impact on prices, as there were indications that China had completed its march towards lifting epidemic restrictions and gradually reopening the country, which prompted the World Gold Council to expect consumer demand for gold in China to recover again soon, during the report issued by the council early today.

Moreover, the Chinese authorities announced measures to support the local real estate market, including easing restrictions on home buyers, which stimulates the stabilization of investment rates in the country's real estate sector, and then booming consumer demand, which will boost demand for gold metal during transactions.

The report of the World Gold Council had a wide resonance with today's trading, as the report listed its forecasts for a slowdown in global growth by next year at an unprecedented rate for almost 40 years, in response to the repercussions of the corona epidemic and the intention of the majority of central banks worldwide to tighten monetary policy to curb high inflation, which results in booming demand for gold metal as a safe haven to hedge against risks and economic fluctuations, especially economic recession.