XAUUSD : In which direction will gold move?
Updated
Gold slid after high inflation in the US extinguished expectations of the Fed cutting interest rates
Gold fell ahead of the Fed meeting, where policymakers are expected to keep interest rates high for longer to control inflation.
Gold prices continued last week's momentum and fell by 0.8%. According to data, the US core PCE index rose at a breakneck pace in March. The swaps market is currently only pricing the Fed will cut interest rates once this year, well below the cut. around 150 bps is expected at the beginning of the year. High interest rates are often negative for gold because gold has no interest rate.
Gold also lost some support as demand for safe-haven assets weakened, geopolitical risks also decreased as the US was trying to secure a ceasefire agreement in meetings in the Middle East.
The foreign exchange market is also in the spotlight as the possibility grows that Japan will support the JPY after the currency fell to its lowest level in more than three decades. If they act, the USD will weaken.
Gold has risen about 13% this year, hitting a record earlier this month even though the Fed's cut deadline was pushed back. This price increase is linked to central bank buying, strong demand from Asia, especially China, and rising geopolitical tensions from Ukraine to the Middle East.
Gold fell ahead of the Fed meeting, where policymakers are expected to keep interest rates high for longer to control inflation.
Gold prices continued last week's momentum and fell by 0.8%. According to data, the US core PCE index rose at a breakneck pace in March. The swaps market is currently only pricing the Fed will cut interest rates once this year, well below the cut. around 150 bps is expected at the beginning of the year. High interest rates are often negative for gold because gold has no interest rate.
Gold also lost some support as demand for safe-haven assets weakened, geopolitical risks also decreased as the US was trying to secure a ceasefire agreement in meetings in the Middle East.
The foreign exchange market is also in the spotlight as the possibility grows that Japan will support the JPY after the currency fell to its lowest level in more than three decades. If they act, the USD will weaken.
Gold has risen about 13% this year, hitting a record earlier this month even though the Fed's cut deadline was pushed back. This price increase is linked to central bank buying, strong demand from Asia, especially China, and rising geopolitical tensions from Ukraine to the Middle East.
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