Gold price is recovering some lost ground around $1,920 due to USD demand.
After falling to a weekly low of $1,913 during the early Asian session on Friday, the gold price (XAUUSD) has recovered some of its recent losses.
Gold prices are falling as a result of Federal Reserve (Fed) Chair Powell’s hawkish views.
At the time of writing, Gold was up 0.08% on the day, trading at $1,921.62.
Fed Chairman Jerome Powell underlined the Fed’s commitment to targeting 2% inflation in a news conference on Wednesday. Powel also stated that the Fed is willing to hike interest rates if necessary.
According to the Federal Reserve’s most current quarterly forecasts, theThe benchmark overnight interest rate may be hiked one more time this year to a high range of 5.50% to 5.75%, and rates may be significantly tighter than originally projected through 2024.
Furthermore, the Fed changed its Summary of Projections (SEP), suggesting that policymakers expect interest rates to reach 5.1% by the end of 2024 (up from 4.6% before). Rising interest rates increase the opportunity cost of investing in non-yielding assets, signaling a bearish prognosis for precious metals.
In terms of data, the US weekly initial jobless claims fell to 201,000, the lowest level since January. Furthermore, the Philadelphia Fed fell to -13.5 in September from 12.0 in the previous measurement, a worse-than-expected -0.7. Existing-Home Sales decreased to 4.04 million. MoM in August, up from 4.07M the previous month.
Investors will be watching the preliminary US S&P Global/CIPS PMI data with bated breath.
Looking forward, gold traders will be watching the preliminary US S&P Global/CIPS PMI data for September, which will be released later on Friday. These numbers may point to a definite direction for the gold price.
