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Why the price of gold may change this week

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Multiple factors may influence the price of gold this week. Getty Images/iStockphoto

The price of gold has surged so far in 2024, breaking numerous price records in the process. Starting at $2,063.73 on January 1, the yellow metal rose as high as $2,439.98 per ounce on May 20. And while it's come down a bit since that record was met, gold is still comfortably above the price it started the year at, sitting at $2,297.47 per ounce as of June 10. 

But that could significantly change this week, giving prospective investors a reason to get started right now. Multiple factors drive the price of gold, several of which may influence the price as soon as mid-week. Understanding these factors will allow investors to better time their investing moves and perhaps even turn a quick profit. Below, we'll break down three reasons why the price of gold may change — possibly by a significant margin — this week.

See how you could benefit by investing in gold here today.

Why the price of gold may change this week

Here are three major factors that could influence the price of gold as the week progresses.

The new inflation report will be released

Gold, known for its ability to hedge against inflation by maintaining its value and even growing in price during inflationary periods, has seen its popularity (and price) grow in recent years as Americans coped with higher prices. And, on June 12, the latest inflation report from the Bureau of Labor Statistics will be released. 

Earlier reports in 2024 have been mixed, partially contributing to the surging price of gold. And considering that the rate only dropped from 3.5% to 3.4% in April, inflation looks to be stubborn right now. So, if the May report is another disappointing one, gold's price may adjust to account for investors looking for some alternative relief.

Learn more about how gold can help with inflation here.

The Federal Reserve will meet again

The federal funds rate is stuck at its highest point in decades after the Fed raised it last summer to a range between 5.25% and 5.50%. But as inflation has cooled optimism around a potential rate cut has risen. That optimism may collide with reality on June 12, however, if the inflation report released earlier that day shows little or no improvement. The Fed, which concludes its latest meeting the same day, will then need to decide whether to keep the rate unchanged or adjust it once again. 

If it's another adjustment upward, in conjunction with a rising inflation rate, the price of gold, long considered a safe-haven asset in economic circumstances like this, may rise once again. On the other hand, if the inflation report is positive and the Fed issues a rate cut — or even hints at one to come — the price of gold may adjust downward, allowing investors to get involved at a lower price point. 

Investors may adjust their approach

There's no way to accurately predict the approach investors will take regarding gold this week until both of the aforementioned scenarios take place. But what if inflation drops and the Fed keeps rates the same? Or what if inflation remains stagnant but the Fed talks of a rate cut for later this year? Any number of scenarios could affect the economy and thus cause some investors to adjust their approach to gold. That, in turn, could make the price rise or fall, perhaps even significantly.

That's why it makes sense to invest in the precious metal now before the price becomes prohibitive and you lose out on protections you may be more in need of by the end of the week.

Get started with gold here now.

The bottom line

The price of gold is especially influenced by inflation and the Federal Reserve's attempts to keep it in check, both of which will be in the news this week. And, with the prospect for an adjusted investment approach from many, based on those scenarios, high, beginner investors should consider making their entrance into the gold investing market now, while the price is still manageable and the benefits are still timely. Just make sure to keep your investment moderate as most experts recommend capping it at 10% or less of a diversified portfolio

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