Gold price finds some support at $1,900, but fails to entice buyers.
During the Asian session on Wednesday, the gold price (XAUUSD) shows some resilience below the $1,900 barrier. But fails to make any major rebound from a one month low reached the previous day.
Softer risk tone supports the safe-haven XAUUSD, while a stronger USD limits gains.
A generally lower risk tone helps the safe-haven precious metal. But the widespread strong positive mood around the US Dollar (USD) works as a headwind.
On Tuesday, data from the United States (US) were revealed. The Conference Board’s Consumer Confidence Index dipped to a four month low. In September, according to the data. This prompted fears that consumers are suffering the effects of persistently high inflation. And increasing interest rates. Aside from that. Investor concern over a real estate crisis in China the world’s second largest economy continues to support. Conventional safe-haven assets, including the gold price.
Meanwhile, the USD Index (DXY), which monitors the US dollar. Against a basket of currencies, reaches a new high since November 2022. Discouraging bulls from making aggressive wagers on the XAUUSD.
Federal Reserve (Fed) took a more hawkish tone last week.
The Federal Reserve (Fed) took a more hawkish tone last week, boosting the probability of future policy tightening. Furthermore, recent remarks by various Fed officials confirm expectations for at leastOne more rate rise is expected before the end of the year. This continues to sustain rising US Treasury bond rates, which support the USD and limit the non-yielding gold price.
Daily Market Movers: Gold is struggling to entice buyers as additional Fed rate rises are expected.
A worsening in consumer mood in the United States adds to market concerns of a deeper economic collapse.
The economic troubles of China also impact on investor mood and bolster the safe-haven gold price.
The US Dollar rises to a new 10-month high, putting a cap on any substantial comeback for gold.
Bets for another Fed rate rise in 2023 continue to support rising US bond rates and the USD.
