Gold hits one-week high amid uncertain US fiscal policy

Reuters reports gold prices rose to their highest level in a week on Wednesday amid a weaker dollar and increased demand for safe-haven assets due to uncertainty in the US fiscal policy. Congress is currently debating a sweeping tax bill.

According to Marex analyst Edward Meir, the dollar index lost more than one point in the last 24 hours due to the Moody's downgrade of the US rating, as well as skepticism about Trump's new bill. On Tuesday, the president urged his Republican colleagues in Congress to support the tax cut proposal. However, he failed to convince several of his allies.

KCM Trade expert Tim Waterer predicts that gold will grow in the medium and long term. At the same time, positive news about trade deals could hinder a return to the $3,500 level.

Reuters states that markets now expect the Fed to resume its course of monetary easing in October. By the end of December, rates are projected to be cut by about 54 basis points. Easing credit conditions usually supports gold.