Gold price fell due to lower US rates and a stronger US dollar.
The gold price (XAUUSD) recovers from multi-day lows but stays below the $2,500 level amid a renewed bid bias in the US Dollar (USD) on Wednesday. However, continued global worries and upcoming Federal Reserve (Fed) rate reduction may support the yellow metal in the near term.
JOLTS Job Openings and the Fed Beige Book are due later on Wednesday.
Later on Wednesday, JOLTS Job Openings and the Fed Beige Book will be issue. Investors On Friday, the highly anticipated US August Nonfarm Payrolls (NFP) report will be widely watched, as it may decide the magnitude and pace of the likely rate decrease at the Federal Reserve’s September policy meeting. If the data displays a lower-than-expected figure, it may stoke speculation of a US recession and further Fed rate reduction. As interest rates fall, the opportunity cost of storing non-yielding gold decreases, potentially boosting the precious metal even more.
Daily Digest Market Movers: Gold price improves, but strong USD may limit its rise.
China’s Caixin Services PMI fell to 51.6 in August from 52.1 in July, falling far short of the market consensus of 52.2 for the reported month.
“We see evidence that speculative positioning in gold has effectively peaked out for the The time being. I believe the extent to which gold is under pressure from the dollar’s gain supports our opinion on positioning,” said Daniel Ghali, commodity strategist at TD Securities.
The US ISM Manufacturing PMI increased to 47.2 in August from an eight-month low of 46.8 in July. This figure fell below the market consensus of 47.5.
According to the CME Group’s FedWatch measure, traders increased the likelihood of a more aggressive half-point cut to 39%, up from 31% prior to the US ISM Manufacturing PMI survey.
The number of US JOLTS job openings predicted to fall to 8.10 million from 8.184 million in June.
The US ISM Services PMI expected to rise to 51.4 in August, up from 51.1 in July.
