As we approach the Federal Reserve's interest rate meeting in December, complex macroeconomic indicators in the United States make the prospect of interest rate cuts increasingly uncertainAt the same time, recent data released by China's central bank shows that the country's gold reserves at the end of November totaled 72.96 million ounces, a slight increase of 160,000 ounces compared to the end of October, indicating a positive signal for the gold industry.

Examining the U.Seconomic landscape, the latest Personal Consumption Expenditures (PCE) price index data released by the Commerce Department indicates that the core PCE year-on-year inflation rate rose to 2.8%, aligning with market expectations, up from the previous value of 2.7%. Analysts note that the Federal Reserve's preferred inflation metric, core PCE, has shown a rebound, suggesting that while inflation may be slowing, it remains persistent

This complicates the Fed's decision-making process regarding the next potential interest rate cut.

In November, the ADP reported only 146,000 new jobs added, marking the lowest figure in four monthsFurthermore, the Institute for Supply Management (ISM) noted that the service sector's expansion rate slowed to its most sluggish pace in three months, falling significantly short of expectationsHowever, the Fed's Beige Book highlighted that economic activity is showing slight growth across much of the country, with businesses becoming more optimistic about future demand.

As of the week ending November 30, initial jobless claims amounted to 224,000, above the anticipated 215,000, while prior week's figures were revised from 213,000 to 215,000. This indicates a gradual cooling of the labor market.

According to the CME FedWatch Tool, there is only a 14.9% probability that the Federal Reserve will maintain current interest rates through December, while the likelihood of a cumulative 25 basis point cut stands at 85.1%.

Overall, the anticipated U.S

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non-farm payroll report suggests that a rebound in the unemployment rate could be more consequentialTherefore, it appears highly probable that the Fed might initiate a 25 basis point cut in DecemberCoupled with the recent increase in gold reserves announced by the People's Bank of China after a six-month pause, this development is likely to further bolster market confidence in gold prices and may shift the domestic and international gold price disparity to a positive directionConsequently, commodity futures analysts believe there is potential for precious metal prices to maintain a strong upward trend in the short term.

What are the major driving forces behind the rising gold prices currently?

- Risk Aversion: In recent years, persistent geopolitical conflicts, regime transitions, and alterations in foreign policy have escalated uncertainty in the global political and economic landscape

This, combined with rising geopolitical tensions, has sustained a robust demand for gold as a safe haven.

- Central Bank Gold Purchases

Global demand for gold has remained strong in 2023, with central banks actively increasing their gold reservesAccording to a report by the World Gold Council titled "Gold Demand Trends" released in 2023, central banks around the world have continued to purchase gold at an astonishing rate, totaling 1,037 tonsMoreover, plans for further increases in gold reserves are in place.

The relentless purchasing of gold by central banks bolsters demandDuring the first three quarters of the year, global central banks collectively acquired 820 tons of gold, with October alone witnessing a net purchase of 60 tons—setting a new record for 2024 and representing twice the average monthly purchasing amount over the past twelve months

Emerging market central banks are notably leading this gold acquisition.

Additionally, recent data from the People's Bank of China reveals that the country's gold reserves reached 72.96 million ounces at the end of November, an increase of 160,000 ounces from October, reflecting China’s strategic emphasis on gold assetsThis move is likely to enhance market confidence regarding gold, imparting a positive signal for the gold industry.

- U.SDebt Risks

The U.Snational debt has surged rapidly over recent years, particularly following the pandemic in 2020. To mitigate the economic fallout from COVID-19, the U.Sgovernment undertook extensive fiscal stimulus measures, resulting in a significant increase in federal debt.

From 28 trillion dollars in 2021, the U.S