Gold prices in the Philippines rose on Friday, according to FXStreet data. The price per gram increased to 8,279.03 Philippine Pesos (PHP) from PHP 8,176.40 on Thursday. The price for one tola went up to PHP 96,565.03 from PHP 95,367.91 the day before. For conversions, the price for 10 grams is PHP 82,790.34, and a troy ounce costs PHP 257,506.90. FXStreet sets local gold prices by looking at international rates (USD/PHP) and converting them to PHP. Daily updates show market trends, though local prices may vary slightly.

Gold as a Hedge Against Inflation

Gold is known to hold its value, making it a safer choice during uncertain times and an effective way to guard against inflation. It doesn’t depend on any one government, which makes it a sought-after investment. In 2022, central banks bought 1,136 tonnes of gold, worth around $70 billion, to add to their reserves. Gold prices usually rise when the US Dollar and US Treasuries fall, providing a way to diversify investments. Prices can change based on economic stability, interest rates, and the dollar’s performance. Unrest or signs of a recession can boost gold’s attractiveness due to its perceived safety. As we kick off the new year, gold prices are trending upward, continuing the momentum from late 2025. This shift aligns with gold’s role as a safe-haven asset, especially with current market conditions. For traders of derivatives, this implies that the factors supporting gold over the past year are still strong. The expectation of lower interest rates from the US Federal Reserve this year is a significant advantage for gold. After the Fed paused rate hikes and suggested a softer approach through 2025, the market is ready for the first cuts. Typically, lower interest rates mean a reduced opportunity cost of holding non-yielding gold, which can lead to price increases.

Central Bank Demand and Market Trends

Demand from central banks continues to support the market, a trend apparent since record buying in 2022. Data from the World Gold Council indicates that emerging market central banks, especially the People’s Bank of China, have been steadily boosting their reserves. This strategy is expected to persist, cushioning any major price drops. Ongoing geopolitical instability also helps maintain gold’s value. Tensions from conflicts that escalated in 2024 have kept investors wary. This situation further cements gold’s reputation as an important way to diversify portfolios during tough times. With this positive outlook, traders might want to position for potential gains in the coming weeks. Buying call options with strike prices above last year’s highs could be a smart strategy. This allows investors to benefit from a possible price rise while managing risks. The ongoing weakness of the US Dollar also significantly impacts the gold price in dollars. If the Fed relaxes its monetary policy as expected, the dollar may weaken further. This inverse relationship is an important factor to consider when planning new trades. Create your live VT Markets account and start trading now.

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