Gold price recovered despite strong USD demand.
The gold price (XAUUSD) attracted some purchasers during Wednesday’s Asian trading hours. Safe-haven demand, spurred by global tensions and uncertainty, as well as continuous central bank purchases, might support a gold advance.
Investors bet less on the Fed’s expected interest rate reduction in 2024.
Nonetheless, hawkish views by Federal Reserve (Fed) officials may temper optimism for probable interest rate decreases in 2024. Notwithstanding weaker-than-expected US employment data in April. As a result, the precious metal may fall in value.
The Fed’s (Fed) Philip Jefferson, Susan Collins, and Lisa Cook are slated to talk later on Wednesday.
Later on Wednesday, Philip Jefferson of the Federal Reserve (Fed), Susan Collins. And Lisa Cook are scheduled to speak. The Fed policymakers’ hawkish remarks may boost the greenback and weigh on USD denominated gold. Gold dealers will keep an eye on the University of Michigan’s consumer mood index on Friday.
Daily Market Movers: Gold prices surge higher despite uncertainty.
Minneapolis Fed President Neel Kashkari said on Tuesday that it is too early to proclaim that inflation has paused. And the Fed may lower interest rates this year if price pressures lessen.
Richmond Fed President Thomas Barkin stated that current interest rates are restrictive enough to calm the economy and return inflation to the 2% target.
Financial markets are currently pricing in approximately The Fed is expected to lower rates by 50 basis points (bps) this year, with a 65.7% chance of a rate decrease of at least 25 basis points in September, according to CME’s FedWatch Tool.
The preliminary University of Michigan Consumer Sentiment Index will be announced on Friday. And it is expected to fall from 77.2 in April to 76.0 in May.
Israeli forces launched airstrikes at Gaza’s southernmost city. Even though Hamas agreed to a cease-fire proposal on Monday, Israel said the terms did not match its criteria, according to the New York Times.
The People’s Bank of China (PBoC) increased its gold holdings by 60,000 troy ounces in April. Extending the string of consecutive purchases to 18 months.
