Gold prices remain at a two-month high reached on Friday.
The gold price (XAUUSD) attracted some buyers for the fourth day in a row on Monday. Trading near its highest level since December 28, which was reached on Friday. Friday’s disappointing release of the US ISM Manufacturing PMI. And the University of Michigan’s Consumer Sentiment Index, together with less-hawkish words from Federal Reserve (Fed) officials. Confirmed betting on a June rate cut. This, in turn, keeps the US Dollar (USD) bulls on the defensive and serves as a tailwind for Yellow metal.
Aside from that, a lower tone in US equity futures is viewed as a positive element for the safe-haven gold price. The gain, however, remains limited as traders are hesitant to put aggressive directional wagers. And seek additional clues regarding the Fed’s rate-cutting path.
This week’s US data/event concerns should provide new momentum.
Investors will keenly watch Fed Chair Jerome Powell’s congressional testimony. Which, coupled with the US Nonfarm Payrolls (NFP) report on Friday, should add some major push to the XAUUSD.
Daily Market movers: Gold price stays supported by Fed rate decrease bets and muted USD demand.
The US Dollar remains on the defensive in the aftermath of Friday’s weak US macro data. And less-hawkish remarks by Federal Reserve officials. Which is viewed acting as a tailwind for gold. The ISM survey found that company activity in the US manufacturing sector dropped more than expected in February, with employment falling to a seven-month low.
The US ISM Manufacturing Index decreased to 47.8 from 49.1 in January, as the New Orders Index dipped to 49.2, while the Prices Paid Index crept lower to 52.5 from 52.9 the previous month.
In addition, the University of Michigan’s Consumer Sentiment Index fell to 76.9 in February, missing forecasts, despite inflation expectations being unchanged.
Chicago Federal Reserve President Austan Goolsbee observed that the policy rate is fairly restrictive, while Dallas Fed President Lorie Logan stated that it would be reasonable to limit the pace of The balance sheet is shrinking.
Fed Governor Adriana Kugler stated that efforts on disinflation will continue, while Richmond Fed President Thomas Barkin predicted that overall inflation will fall in the next months.
Fed Governor Christopher Waller stated that he would prefer the central bank to increase its holdings of short-term Treasuries.
Furthermore, Fed Governor Christopher Waller stated that he would prefer the central bank to increase its holdings of short-term Treasuries. Putting some downward pressure on US Treasury bond yields.
A milder risk tone also gives support to the safe-haven XAUUSD. Amid muted US Dollar demand, but the upside appears limited. Ahead of the major US data and Fed Chair Jerome Powell’s speech.
