XAUUSD : Gold prices are continuing their downward streakGold prices were gloomy at the beginning of the new year, following a strong recovery in the USD as traders reduced bets that the Fed could cut interest rates as soon as March.
Stronger-than-expected nonfarm payrolls data on Friday points to labor market resilience — which gives the Fed more room to keep interest rates higher for longer.
Spot gold price decreased 0.5% to 2,035.69 USD/ounce, while gold futures price due in February decreased 0.4% to 2,042.25 USD/ounce at . Both types of gold fell 0.9% in the first week of 2024.
The market is now fully focused on US CPI data for December, expected this Thursday.
The data comes on the heels of the payrolls report, which is expected to show inflation rising from the previous month.
CME Fedwatch shows traders have scaled back their expectations for a March cut. Traders are now pricing in about a 63% chance of a 25 basis point cut in March.
Higher interest rates for longer could be greater short-term pressure on gold. This could drive up the opportunity cost of investing in gold.
