Gold fell slightly on Wednesday as the dollar surged to a four-month high.
Gold price (XAUUSD) fails to build on the previous day’s rebound from the $2,725-2,724 region, or a one-and-a-half week low, and oscillates between modest gains and minor losses during the Asian session on Wednesday. A sharp increase in US Dollar (USD) demand, aided by exit polls showing a lead for Republican nominee Donald Trump in crucial swing states, works as a headwind for the commodity.
Aside from this, The dramatic intraday spike in US Treasury bond yields, combined with the risk-on drive, is another reason keeping the non-yielding gold price under control. However, fears of a further increase in volatility in the aftermath of the US election results prevent traders from initiating strong bearish bets on the safe-haven precious metal, which should help limit any significant decline.
Daily Market Movers: Gold price bulls stay on the sidelines amid rising USD demand.
The US dollar rose to a nearly four-month high in response to US election exit polls, which indicate that the vote is leaning toward former President Donald Trump.
Georgia, a key swing state, was among the first with available exits. Exit surveys show a Trump victory, as do early exit poll results in Wisconsin.
According to CBC News, preliminary exit poll data from Pennsylvania, one of the most carefully watched swing states, show Vice President Kamala Harris ahead.
Exit polls in North Carolina indicate a close race, while preliminary returns in Nebraska District 2 show Harris ahead. CBC News phoned Indiana, Kentucky, and West Virginia to support Trump.
Rising odds of Trump winning the election stoke speculation about the imposition of potentially inflationary tariffs, driving US Treasury bond yields considerably higher.
US election results remove out a key source of uncertainty for markets.
The US election results remove out a key source of uncertainty for markets, prompting a new wave of risk-on trade and further contributing to capping the The gold price considered a safe haven.
The downside for the gold(AUUSD) is mitigated by traders’ caution in the aftermath of the projected increase in volatility across global financial markets.
Iran’s intentions for a retaliation strike in response to Israel’s attack on its land on October 26 have raised concerns about the danger of further escalation in Middle Eastern tensions.
