Gold prices, which surged to an all-time high of $2,450 per ounce in May, have now stabilized around $2,329 per ounce. The World Gold Council noted a notable decline in China’s gold demand, marking its lowest level in four years. Although interest in gold exchange-traded funds remains steady in China, physical consumption of gold dropped significantly in May, as reported by Bitcoin.com News on June 8th.

Gold withdrawals from the Shanghai Gold Exchange totaled 82 metric tons in May, showing a month-on-month decrease of 49 tons and a year-on-year decrease of 30 tons, according to Jia. The high gold price reduced consumer interest in gold jewelry, resulting in weaker-than-anticipated sales during the traditional demand peak of the five-day International Labour Day Holiday in early May. This trend persisted throughout the remainder of the month.

The market analyst from Trading.biz suggested that gold prices are likely to decrease if the Federal Reserve maintains its cautious stance. Following Jerome Powell’s recent remarks where he avoided indicating a rate cut, the analyst predicts gold prices will range between $2250 and $2300 in the next month.

However, if there are ongoing softer Consumer Price Index (CPI) reports and an increase in the unemployment rate, this could prompt the Fed to consider rate cuts by September. Under such conditions, the analyst believes gold prices could potentially rise above $2400.

During the summer months, the gold market is entering a phase of evaluation. With varying demand and unclear monetary policies, both investors and analysts will closely monitor consumer activities, inflation patterns, and decisions made by central banks.

Recent fluctuations in gold prices indicate a prudent market atmosphere, where the interplay between supply and demand, alongside geopolitical and economic factors, will determine its price trajectory in the short run.