Gold Awaits Fed Decision, Struggling for Direction
Gold prices in early Asian trading on Tuesday were indecisive as traders prepared for an expected rate hike and monitored monetary policy cues from the U.S. Federal Reserve in the coming two days.
Key points:
- Spot gold inched up 0.2% to $1,958.20 per ounce by 0119 GMT, while U.S. gold futures slipped 0.1% to $1,959.90.
- The dollar index reached a nearly two-week high, putting pressure on gold as a stronger dollar raises the cost of bullion for buyers using other currencies.
- Markets have already factored in quarter-point rate hikes from the Fed and the European Central Bank. Investors will focus on the statements of Fed Chair Jerome Powell and ECB President Christine Lagarde regarding future plans and their September meetings.
- Rising interest rates pose a challenge for gold, as they increase the opportunity cost of holding non-yielding bullion.
- Recent purchasing managers' surveys indicated a slowdown in U.S. business activity and a larger-than-expected contraction in Europe during July. This suggests that both central banks might be approaching the end of their rate-hike cycles.
- In China, leaders pledged increased policy support for the economy during the post-COVID recovery, emphasizing domestic demand. However, specifics remain scarce, and analysts doubt the likelihood of aggressive stimulus due to concerns about rising debt risks.
GOLD
SELL 1962 - 1964💯💯
✅ TP1: 1955
✅ TP2: 1951
✅ TP3: 1944
🛑 SL: 1968
Key points:
- Spot gold inched up 0.2% to $1,958.20 per ounce by 0119 GMT, while U.S. gold futures slipped 0.1% to $1,959.90.
- The dollar index reached a nearly two-week high, putting pressure on gold as a stronger dollar raises the cost of bullion for buyers using other currencies.
- Markets have already factored in quarter-point rate hikes from the Fed and the European Central Bank. Investors will focus on the statements of Fed Chair Jerome Powell and ECB President Christine Lagarde regarding future plans and their September meetings.
- Rising interest rates pose a challenge for gold, as they increase the opportunity cost of holding non-yielding bullion.
- Recent purchasing managers' surveys indicated a slowdown in U.S. business activity and a larger-than-expected contraction in Europe during July. This suggests that both central banks might be approaching the end of their rate-hike cycles.
- In China, leaders pledged increased policy support for the economy during the post-COVID recovery, emphasizing domestic demand. However, specifics remain scarce, and analysts doubt the likelihood of aggressive stimulus due to concerns about rising debt risks.
GOLD
SELL 1962 - 1964💯💯 ✅ TP1: 1955
✅ TP2: 1951
✅ TP3: 1944
🛑 SL: 1968
Comment:
Gold gains on weaker dollar, traders focus on Fed decision
Comment:
Gold’s rally appears to be losing steam ahead of the US Federal Reserve, the European Central Bank, and the Bank of Japan policy meetings, raising the risk that the rebound this month is corrective.
Comment:
waiting for CB news
