Gold price consolidates recent gains, reaching a one-month high on Thursday.
Gold (XAUUSD) extends its consolidative sideways price trend into the European session on Friday, remaining well within striking distance of a one-month high reached the previous day.
Traders choose to remain on the sidelines ahead of the release of the important US employment report.
Traders now appear hesitant and prefer to wait for the release of the US monthly employment figures, which can provide some clues on the Federal Reserve’s (Fed) policy course and provide a fresh directional impetus to the Yellow metal that produces no yield. Meanwhile, reports of an Israel-Hamas ceasefire, along with the overall euphoric sentiment in global equities markets, operate as a headwind for the safe-haven commodity.
A confluence of variables supports the Gold and favors optimistic traders.
Aside from that, a minor rise in US Treasury bond yields adds to the ceiling on gold prices, while forecasts that the Federal Reserve (Fed) will decrease interest rates this year should help limit the downside. Furthermore, fears over the soundness of regional banks in the US and persistent worry about slowing growth in China the world’s second-largest economy enhance possibilities for a further near-term appreciating rise for the Gold price. Nonetheless, the XAUUSD is on course to achieve small gains for the first week in the previous three. Furthermore, the fundamental background appears to benefit optimistic traders.
Daily Market Movers: Gold price bulls take a respite despite rising US bond yields, ahead of the US NFP.
A succession of unfounded stories of a ceasefire between Israel and Hamas improve investor confidence. Capping the upside for the safe haven Gold price on the week’s final trading day.
Fed Chairman Jerome Powell said on Wednesday. That interest rates had peaked and will fall in the coming months. But downplayed market expectations for a move in March.
Hamas received its first proposal for a lengthy break in Gaza’s violence.
According to reports, Hamas received its first proposal for a lengthy break in Gaza’s violence. In exchange for the release of the remaining hostages, but has yet to respond.
The Houthi rebels claimed to have hit a US commercial ship in the Red Sea. While the US launched further air strikes in Yemen. Purportedly targeting ten drones preparing to launch.
Concerns over the health of regional lenders in the United States resurfaced on Thursday. With New York Community Bancorp reporting significant stress in its commercial real estate portfolio.
China’s official Manufacturing PMI fell for the fourth straight month in January. Indicating that the world’s second-largest economy is struggling to regain momentum.
The yield on the benchmark 10-year US government bond remained around 4%. Amid expectations of a sharp rate drop by the Federal Reserve in 2024, undermining the US dollar.
The Labor Department reported that first jobless claims increased by 9,000. To 224K during the week ended January 27, up from the previous week’s corrected reading of 215K.
Separately, the Institute for Supply Management (ISM) Manufacturing PMI rose from 47.4 to 49.1 in January. While the Prices Paid Index increased from 45.2 to 52.9 in December.
The XAUUSD appears to be on track to end a two-week losing skid, as investors look to US jobs data for clues regarding the Fed’s policy direction and potential trade opportunities.
The widely known NFP report is projected to indicate that the US economy added 180K jobs in January, down from 216K the previous month, while the unemployment rate crept higher to 3.8% from 3.7%.
