Gold remained under moderate selling pressure for the second day in a row.
The gold price (XAUUSD) is under slight selling pressure for the second consecutive day on Tuesday. And stays offered, just above the monthly low as the European session begins. The continued rebound of the US Dollar (USD) from its lowest level since September 20 reached on Monday is seen as hurting the commodity. Furthermore, the fact that there has been no Significant developments in the Israel-Hamas conflict. Add to the flow of funds away from the safe-haven precious metal.
Nonetheless, the lingering potential of a broader Middle East crisis. Along with economic uncertainty, puts investors on edge. This is reflected in a generally weaker tone in the equity markets. Which helps to support the gold price. Aside from that, a new decline in US Treasury bond yields. Driven by firming expectations that the Federal Reserve (Fed) is nearing the conclusion of its policy tightening campaign. Should limit losses for the non-yielding yellow metal. As a result, bearish traders should exercise caution.
Investors may also prefer to wait for additional clues regarding the Fed’s future rate-hike path. As a result, the emphasis will shift. Keep an eye out for speeches by prominent FOMC members. Such as Fed Chair Jerome Powell’s appearances on Wednesday and Thursday. The outlook will be critical in determining the next leg of a directional move for the gold price and impacting the near-term USD price dynamics. Meanwhile, the release of US Trade Balance data on Tuesday may provide some trade momentum later in the early North American session.
Daily Market Movers: Gold prices remain at monthly lows despite some USD strength.
The uncertainty surrounding the Federal Reserve’s next policy decision spurs some short-covering. And puts pressure on the gold market.
The weaker-than-expected US jobs report announced on Friday strengthens the belief that the US central bank will preserve the status quo for the third time in a row in December.
Fed Governor Lisa Cook stated on Monday that the central bank’s current interest rate is sufficient to return inflation to the 2% target.
Minneapolis Fed President Neel Kashkari stated that the US economy has proven to be quite resilient, and that tightening will not return inflation to 2% in a reasonable time frame.
Bets that the Fed will stop rising interest rates may help reduce losses during this period of economic uncertainty.
Investors are now looking forward to talks by other prominent FOMC members, as well as statements by Fed Chair Jerome Powell on Wednesday and Thursday.
Treasury bond yields in the United States unable to capitalize on an overnight goodish bounce and fell on Tuesday on bets that the Fed is done hiking rates.
This, together with the possibility of a further escalation in qua for the third time in a row in December.
Fed Governor Lisa Cook stated on Monday that the central bank’s current interest rate is sufficient to return inflation to the 2% target.
Minneapolis Fed President Neel Kashkari stated that the US economy has proven to be quite resilient, and that tightening will not return inflation to 2% in a reasonable time frame.
Investors are now looking forward to talks by other prominent FOMC members, as well as statements by Fed Chair Jerome Powell on Wednesday and Thursday.
Treasury bond yields in the United States unable to capitalize on an overnight goodish bounce and fell on Tuesday on bets that the Fed is done hiking rates.
This, together with the possibility of a further escalation in The war between Israel and Hamas, as well as economic uncertainties, should bolster the safe-haven precious metal.
China’s trade balance fell drastically in October, from $77.71 billion to $56.53 billion. Its lowest level since May 2022, due to an unexpected spike in imports.
Chinese exports decreased more than predicted. Indicating deterioration in global demand. Particularly from its main trading partners, Europe and the United States.
