Global risk assets tumble, prompting a surge in gold buying! Gold prices stabilize and rebound after a sharp fall.

Gold rebounded after experiencing the largest single-day decline in over a week, as the overall risk-off sentiment in the financial markets boosted demand for safe-haven assets. On Wednesday, the spot price of gold rose to around $3950 per ounce. The previous trading day, the spot gold price fell nearly 2% due to the fifth consecutive day of gains in the US dollar index. Concerns over high valuations continued, causing global stock markets to extend their losses on Wednesday after experiencing the most severe decline in nearly a month, with most commodities also moving lower. Gold prices have risen by around 50% so far this year, reaching historic highs last month before partially retreating. This round of correction - occurring after several signs of excessive bullishness in gold prices - is accompanied by outflows in gold ETF funds. Traders are assessing whether this decline is nearing its end. TD Securities strategist Bart Melek stated in a report, "It should not be surprising that gold consolidates within the lower range of $3800 to $4050 per ounce." He pointed out factors contributing to this phenomenon include uncertainty about the prospect of Fed interest rate cuts and concerns about gold buying in the retail sector in China. He added that most factors driving the increase in gold prices this year have not changed. After the consolidation phase, continued official sector buying and strong demand from private investors are expected to drive gold prices back up. At the time of writing, the spot price of gold rose by 0.23% to $3941.18 per ounce. The US dollar index remains stable after reaching its highest level since mid-May. Silver prices remain unchanged, while palladium and platinum prices are falling. Earlier this week, three Federal Reserve officials did not indicate support for further rate cuts in December when weighing the dual risks of inflation and soft labor market conditions. This week, investors will have more opportunities to understand the stance of Federal Reserve officials, with speeches planned by St. Louis Fed President Bullard and Cleveland Fed President Mester, among others.