Gold prices are holding on to most of their gains today after the Bank of England cut its interest rate by 50 basis points, bringing rates to 1.00%.Today's buying momentum stalled at $924.59 an ounce, but strategists agree that it is only a matter of time before prices moves higher. This afternoon, spot gold prices are up $11.35 to $917.07.
Jimmy Tintle, futures broker at Transworld futures.com, said the low interest rates around the world are largely behind the push in gold prices. He said market players are turning to precious metals and commodities in general, and are looking for better returns on their investments.
"This is the third time we have run up to this level and I think we will break through," he said. "I think commodities in general will recover before all the other markets, as investors look for safe havens."
Although gold prices are expected to keep rising, Ashraf Laidi, market strategist at CMC Markets, said momentum could falter on Friday if U.S. nonfarm payrolls come in better than expected. A positive U.S. employment report would drive investors back into equity markets.
Laidi said the short-term target is for gold to hit $950.
