Gold price is expected to fall toward $1,900 as the US dollar increases.
During the Asian session on Tuesday, gold prices fell to roughly $1,910 per troy ounce. The US Dollar (USD) is strengthening more. Owing in part to cautious market mood and rising US Treasury rates.
At the time of writing, the US Dollar Index (DXY) is trading at 106.00. On Monday, the index reached its highest level since November. The yield on the 10-year US Treasury note rose to 4.55%, a new high. Which has not been seen since October 2007.
Traders are still pricing in the possibility of the Fed’s policy rates being higher for a long length of time.
Furthermore, the possibility of high interest rates remaining for an extended period is dependent. On the robustness of the US economy. Which puts pressure on non-yielding assets such as gold.
According to Reuters, US President Joe Biden and one of his top aides have both issued warnings. About the possible consequences of a federal government shutdown. They voiced fear that a government shutdown would cause significant problems. Including the loss of food stamps for roughly 7 million low-income women and children.
The remark implies that President Joe Biden and House Speaker Kevin McCarthy had already agreed on federal expenditure levels. It should be emphasized. However that the Republican-controlled House of Representatives. This week, lawmakers may try to enact hefty budget cutbacks.
These proposed changes would need to be approved by the Democratic-controlled Senate, which is anticipated to vote no. If both houses fail to achieve an agreement on federal expenditures, a partial government shutdown might occur the following Sunday.
Gold investors will most likely pay attention to US data.
Gold investors will most likely pay attention to data such as US Consumer Confidence, Durable Goods Orders, Initial Jobless Claims, and the Federal Reserve’s (Fed) favorite inflation measure, the Core Personal Consumption Expenditures (PCE) Price Index, which are due later this week.
These statistics may give critical insights into the US economy’s inflationary pressures and may influence the Fed’s monetary policy, which may influence the price of gold.
