- Gold price currently trades near $1,975 after retracing from the nearly $2,000 mark.
- Federal Reserve (Fed) Chair Powell and other Fed officials signal that rates would be held steady at its November meeting.
- Geopolitical tensions continue to hang over the market, which boosts the safe-haven asset like gold.
- Market players will focus on the US PMI, growth numbers, and the Core Personal Consumption Expenditures (PCE).
Gold prices (XAU/USD) trims a part of the previous week's gains and hovers around $1,975 during the Asian session on Monday. The bullish outlook of the precious metal is bolstered by the safe-haven flows due to the escalating geopolitical tensions in the Middle East. Meanwhile, the US Dollar Index (DXY), a measure of the value of USD against six other major currencies, consolidates around 106.15.
As the FOMC enters its blackout period, there is a clear signal that rates will be held steady at its November meeting. On Friday, Atlanta Federal Reserve (Fed) President Raphael Bostic stated that he doesn't think that the US central bank will cut the rate before the middle of next year. Fed Philadelphia President Patrick Harker reiterated his preference to keep interest rates unchanged. While Fed Cleveland President Loretta Mester said the US central bank is "at or near the peak of the rate hike cycle.
Additionally, Fed Chair Jerome Powell signaled a desire to pause rate hikes and watch how economic data develops in the coming months. Powell further stated that more monetary policy tightening might be appropriate if there are more indications about above-trend growth or if the labor market stops easing. Market players will focus on the US economic data this week, which might convince the central bank about the further monetary policy path. The stronger-than-expected data could lift the US Dollar (USD) higher and weigh on the USD-denominated gold.
On the other hand, rising tension in the Middle East might boost safe-haven assets like gold price. That said, fears that the Israel-Hamas confrontation would escalate into a larger Middle East battle grew on Sunday, with Washington warning of a significant risk to US interests in the region.
Later this week, gold traders will monitor the US S&P Global PMI on Tuesday, the first reading of Q3 Gross Domestic Product (GDP) growth on Thursday, and the Core Personal Consumption Expenditures (PCE) on Friday. Geopolitical tensions continue to hang over the market. Any sign of tensions easing could see precious metal markets come under pressure.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats toward 1.0850 on modest USD recovery
EUR/USD stays under modest bearish pressure and trades in negative territory at around 1.0850 after closing modestly lower on Thursday. In the absence of macroeconomic data releases, investors will continue to pay close attention to comments from Federal Reserve officials.
GBP/USD holds above 1.2650 following earlier decline
GBP/USD edges higher after falling to a daily low below 1.2650 in the European session on Friday. The US Dollar holds its ground following the selloff seen after April inflation data and makes it difficult for the pair to extend its rebound. Fed policymakers are scheduled to speak later in the day.
Gold climbs to multi-week highs above $2,400
Gold gathered bullish momentum and touched its highest level in nearly a month above $2,400. Although the benchmark 10-year US yield holds steady at around 4.4%, the cautious market stance supports XAU/USD heading into the weekend.
Chainlink social dominance hits six-month peak as LINK extends gains
-637336005550289133_XtraSmall.jpg)
Chainlink (LINK) social dominance increased sharply on Friday, exceeding levels seen in the past six months, along with the token’s price rally that started on Wednesday.
Week ahead: Flash PMIs, UK and Japan CPIs in focus – RBNZ to hold rates
After cool US CPI, attention shifts to UK and Japanese inflation. Flash PMIs will be watched too amid signs of a rebound in Europe. Fed to stay in the spotlight as plethora of speakers, minutes on tap.