Shinobi - GOLD: Gold is constrained by the strength of the USD
The factor holding back gold's decline in the midweek session was traders' expectations of an interest rate hike by the US Federal Reserve (Fed). According to the FedWatch tool, there is a 95% chance that the Fed will keep rates unchanged at its September 19 and 20 policy meetings and a 60% chance that interest rates will stay at current levels for the rest of the year.
For now, the market is still waiting for the statements of Fed officials. Recently, Fed Governor Christopher Waller in a recent interview with CNBC said that the latest economic data is making the central bank consider whether to raise interest rates again or not.
While the long-term outlook for gold remains strong, seasonal factors coupled with the strength of equities and the dollar are likely to move the metal, according to Sean Lusk, co-head of trade hedging at Walsh Trading. This quarter retests $1,900 an ounce before surging higher.
For now, the market is still waiting for the statements of Fed officials. Recently, Fed Governor Christopher Waller in a recent interview with CNBC said that the latest economic data is making the central bank consider whether to raise interest rates again or not.
While the long-term outlook for gold remains strong, seasonal factors coupled with the strength of equities and the dollar are likely to move the metal, according to Sean Lusk, co-head of trade hedging at Walsh Trading. This quarter retests $1,900 an ounce before surging higher.
