Gold struggling to gather Traction and is near a one week low.

The gold market (XAUUSD) extended its sideways consolidative price move throughout the Asian session on Wednesday. As traders chose to wait for the outcome of the highly anticipated FOMC monetary policy meeting.

Hawkish Fed expectations support the USD and act as a drag on the metal.

Heading into the significant central bank event risk, the US Dollar (USD) rises to a two week high on growing acceptance. That the Federal Reserve (Fed) will stick to its higher for longer interest rate narrative despite persistent inflation. This, combined with the common risk on
The environment appears to be another factor working against the safe haven precious metal.

The downside for the gold price, however, is mitigated by geopolitical dangers resulting from the ongoing Russia Ukraine war and Middle Eastern tensions.

Traders were hesitant to make big wagers ahead of the critical FOMC decision.

Investors appear hesitant to place new directional bets until more information. Regarding the Fed’s rate cutting plan becomes available. As a result, the attention will remain on new economic estimates. Which, together with Fed Chair Jerome Powell’s remarks at the post meeting press conference, will be critical in defining. The next leg of a directional move for the non-yielding yellow metal.

Daily Market Movers: The gold price continues in a range as speculators anticipate Fed rate-cut hints.

The stronger US inflation data released Last week pushed investors to reduce their expectations. For a June interest rate decrease while remaining supportive of elevated US Treasury bond yields. Which supported the US Dollar and capped the gold price.
The present market pricing indicates a less than 50% chance. That the Fed will lower interest rates for the first time in June. And the central bank’s 2024 median interest rate prediction may be reduced from three to two cuts.
The yield on the benchmark 10-year US government bond rose to its highest level since November 30. Pushing the USD to a two-week high and limiting any significant upside for the non-yielding yellow metal.
Wall Street ended Tuesday’s trading session on a high note, with the S&P 500 Rising to a new record high and discouraging bulls from betting on the safe-haven commodity despite persistent geopolitical worries.
Traders, on the other hand, prefer to wait for the outcome of the highly anticipated two-day FOMC monetary policy meeting for indications on the future path of rate cuts before positioning for the next leg of the XAUUSD directional move.
The US central bank is widely expected to retain interest rates at historic highs, but the market will be watching the “dot plot” for hints about the number and timing of rate decreases this year, which will affect the precious metal.
Furthermore, Fed Chair Jerome Powell’s remarks during the post-meeting news conference may inject some volatility into the financial markets and provide some Significant boost to the gold price.