Gold declines toward $2,060 as US yields edge higher
After rising toward $2,080, Gold reversed its direction and turned negative on the day near $2,060, pressured by the rebound seen in the US Treasury bond yields. Investors brace for the end-of-the-year flows and refrain from placing large bets on XAU/USD
Fundamental Overview
Gold price is finding demand in the Asian session on the final trading day of the year, in the wake of a cautiously optimistic market mood and renewed US Dollar weakness. Investors brace for the end-of-the-year flows and refrain from placing any fresh directional bets on the Gold price, leaving the bright metal in a phase of upside consolidation at around $2,070.
In the day ahead, risk sentiment, the US Dollar price action and profit-taking could significantly impact Gold price, as traders switch to the sidelines ahead of the extended New Year weekend.
On Thursday, Gold price enjoyed two-way businesses, initially refreshing a three-week top before reversing to settle below the $2,070 level. In the first half of the day, Gold price benefitted from a sustained weakness in the US Dollar and the US Treasury bond yields, as strong US bond auctions and increased dovish US Federal Reserve (Fed) rate cut expectations underwhelmed.
However, the US Dollar staged a solid rebound from five-month lows against its major rival currencies, helped by a modest uptick in the US Treasury bond yields, as markets resorted to profit-taking on the US Dollar shorts heading into thinner liquidity conditions on Friday.
Investors shrugged off the mixed US economic data, allowing the US Dollar to breathe a sigh of relief. The US Pending Home Sales Index, a forward-looking indicator based on contract signings rather than closings, declined 5.2% from a year ago, monthly data from the National Association of Realtors showed. Meanwhile, the US Labor Department said that new state unemployment benefit claims rose by 12,000 last week to 218,000.
Fundamental Overview
Gold price is finding demand in the Asian session on the final trading day of the year, in the wake of a cautiously optimistic market mood and renewed US Dollar weakness. Investors brace for the end-of-the-year flows and refrain from placing any fresh directional bets on the Gold price, leaving the bright metal in a phase of upside consolidation at around $2,070.
In the day ahead, risk sentiment, the US Dollar price action and profit-taking could significantly impact Gold price, as traders switch to the sidelines ahead of the extended New Year weekend.
On Thursday, Gold price enjoyed two-way businesses, initially refreshing a three-week top before reversing to settle below the $2,070 level. In the first half of the day, Gold price benefitted from a sustained weakness in the US Dollar and the US Treasury bond yields, as strong US bond auctions and increased dovish US Federal Reserve (Fed) rate cut expectations underwhelmed.
However, the US Dollar staged a solid rebound from five-month lows against its major rival currencies, helped by a modest uptick in the US Treasury bond yields, as markets resorted to profit-taking on the US Dollar shorts heading into thinner liquidity conditions on Friday.
Investors shrugged off the mixed US economic data, allowing the US Dollar to breathe a sigh of relief. The US Pending Home Sales Index, a forward-looking indicator based on contract signings rather than closings, declined 5.2% from a year ago, monthly data from the National Association of Realtors showed. Meanwhile, the US Labor Department said that new state unemployment benefit claims rose by 12,000 last week to 218,000.