New York gold futures surged sharply on Tuesday (December 10), with the February 2025 contract rising $38.50, or 1.43%, to $2721.50 per ounce; On Wednesday (December 11th), in the morning session of the Asian market, gold prices continued to rise, with the COMEX gold futures contract for February hitting a high of $2738.9 per ounce, a new high since November 7th. This breakthrough occurred after a long period of consolidation, marking a significant shift in the gold trading pattern.

The current uptrend is supported by multiple convincing factors, starting with the geopolitical uncertainty in the Middle East. Market sources say that with the dramatic development of the regional situation, including reports of the collapse of Syria's long-standing ruling regime, safe haven buying has increased. Interestingly, despite the strengthening of the US dollar, gold prices have risen, and the US dollar is usually a bearish indicator for commodity prices.

The central bank's activities have become another important factor driving the upward trend of gold prices. After the record breaking gold price may pause, investors' interest in gold reserves has reignited. This type of institutional buying indicates a growing confidence in gold as a strategic asset allocation.

The trajectory of the Federal Reserve's monetary policy also plays a key role in the current dynamics of the gold market. Federal Reserve Chairman Powell has outlined a cautious approach to interest rate normalization, predicting that interest rates will gradually decrease from the current 5% or above to between 3% and 3.5% in the coming years. The recent interest rate cuts, including a 50 basis point cut and then a 25 basis point cut, have laid the foundation for possible further easing.

Market expectations are currently firmly focused on the upcoming Federal Open Market Committee (FOMC) meeting. The Chicago Mercantile Exchange's Federal Reserve Watch tool shows an 86.1% chance of a 25 basis point rate cut, with Powell emphasizing a cautious and prudent approach. His recent remarks indicate that the Federal Reserve will not rush to cut interest rates and will closely monitor economic indicators and inflation trends.

Although Powell's stance of maintaining higher borrowing costs typically poses resistance to gold, sporadic market reactions indicate that these considerations have been taken into account in the assessment. Precious metals continue to receive support from the complex interplay of geopolitical tensions, central bank strategies, and monetary policy expectations.