The international gold price has climbed above the $4,600-per-ounce level. Attention is now focused on whether further gains will push it through the $4,700 mark, or whether it will enter a correction phase following a sharp short-term rally.

As of 6:13 p.m. Korean time on the 21st, the international gold price on the New York Mercantile Exchange (GC) stood at $4,657.70 per ounce, up $86.30 (1.89%) from the previous session.

A Weaker Dollar and Shifts in the Treasury Market Lift Gold Prices

The recent rally in gold prices has been attributed to a weaker dollar and changes in the U.S. Treasury bond market, among other factors. On the 21st, gold prices rose while the dollar weakened in international markets.

Generally, when the dollar falls, gold traded in dollars becomes more affordable for non-dollar-based investors, which can be supportive of gold prices.

Geopolitical uncertainty is another variable. Concerns persist over U.S. moves to tighten economic pressure on Iran and wariness about the Middle East situation. If risk-averse sentiment expands, funds could flow into gold, which is regarded as a representative safe-haven asset. However, if inflation fears driven by rising international oil prices stir up interest rate expectations, gold price volatility could increase.

Challenge for $4,700 vs. Short-Term Correction

Market eyes are now turning to the $4,700-per-ounce level. With only a limited distance remaining between the current price and $4,700, gold could attempt a breakout above that level if the upward trend continues.

On the other hand, if profit-taking selling emerges following the steep recent gains, it would be difficult to rule out another battle around the $4,600 level.

Next Week's U.S. PCE and GDP Data to Determine Direction

In particular, key U.S. economic indicators scheduled for release next week are expected to be a decisive variable for gold prices.

The U.S. Bureau of Economic Analysis (BEA) is set to release the July personal consumption expenditures (PCE) price index on the 26th. The PCE price index is a key gauge the Federal Reserve uses to assess price trends, so its results could move interest rates, the dollar, and gold prices together.

Attention is also focused on U.S. second-quarter gross domestic product (GDP) figures. If economic indicators point to easing inflation and a weakening economy, market interest rates and the dollar could fall, providing further upward momentum for gold. Conversely, if price pressures prove stronger than expected or signals emerge that the U.S. economy remains resilient, expectations for Fed monetary easing could recede, weighing on gold prices.

Ultimately, the key point to watch is whether the international gold price, having broken above $4,600, will maintain its upward momentum and challenge the next level of $4,700, or take a breather after the sharp short-term surge. Next week's major U.S. economic indicators, including PCE, along with movements in the dollar and Treasury yields, are expected to be the key factors shaping the direction of gold prices.

[※ Gold prices can fluctuate from moment to moment, and this article is for reference only in making investment decisions.]