Short

Gold Holds Steady Amid Economic Uncertainty

Updated

Gold prices have remained relatively stable in early Asian trading. According to a research note from ANZ analysts, the market's confidence in another interest rate hike by the U.S. Federal Reserve at its September meeting has diminished. This shift is attributed to the decline in bond yields and a weakening U.S. dollar. When bond yields fall, which move inversely to prices, it tends to enhance the attractiveness of precious metals like gold, which do not offer interest. Furthermore, there are indications of weakening conditions in the U.S. economy, as U.S. job openings continued to decrease in July, suggesting a loss of momentum in the labor market. Additionally, a survey conducted by the Conference Board revealed that U.S. consumer confidence in August dropped more than initially anticipated. As a result of these factors, spot gold remains relatively unchanged, trading at $1,936.53 per ounce.

SELL 1936-1938🕯

✔️ TP1: 1932
✔️ TP2: 1926

🚫 SL: 1943

Note

* Spot gold remained steady at $1,936.59 per ounce as of 0115 GMT, hovering near its highest levels since August 7th, which were reached on Tuesday. Concurrently, U.S. gold futures stabilized at $1,964.30.

Note

U.S. Treasury yields reached a three-week low on Tuesday due to weakening data and a declining dollar, consequently reducing the cost of gold for holders of other currencies. These lower rates heightened the demand for gold, which does not yield interest.

Note

In July, U.S. job openings fell to their lowest point in almost 2.5 years, signaling a gradual slowdown in the labor market and strengthening the anticipation that the Federal Reserve will maintain current interest rates next month.

Note

Investors are eagerly anticipating the US PCE price index, the Federal Reserve's favored inflation measure, scheduled for release on Thursday, and nonfarm payrolls on Friday, in search of additional insights into the future path of interest rates.

Note

The Federal Reserve is anticipated to maintain its current stance at its upcoming meeting next month, with market expectations reflecting a 44% probability of a rate increase in the November meeting. This is a slight decrease from the 51% probability reported just a day earlier, as indicated by the CME's FedWatch Tool.

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