Gold price surged high for the second consecutive day despite the dovish shift. This resulted in the Federal Reserve halting interest rate hikes with the possibility of rate cuts in the future. FED’s Stance and USD value drop have opened doors for more profit through gold.
Saturday, November 18 -The Gold price (XAU/USD) has experienced a second consecutive day of upward movement, reaching a nearly two-week high around the $1,987-1,988 region during the European session. This marks the fourth joyous day in the last five, supported by various factors affecting the market.
The recent softer US Consumer Price Index (CPI) and Producer Price Index (PPI) figures have reinforced the belief that the Federal Reserve (Fed) may halt its interest rate hikes. Markets are now anticipating the possibility of rate cuts in the first half of 2024. Consequently, the benchmark 10-year US Treasury yield has dropped to a more than two-month low, supporting the non-yielding Gold.
Despite expectations of a dovish shift by the US central bank, the US Dollar (USD) has not seen a significant recovery, staying at its lowest level since September 1. Mixed signals from high-level US-China talks have further supported the safe-haven appeal of Gold, contributing to its positive momentum.
Investors closely watch US housing market data and Fedspeak for potential market impacts. Despite short-term fluctuations, the XAU/USD is on track to register weekly gains of nearly 2.5%, breaking a two-week losing streak.
With Gold edging towards a two-week high, investors are on high alert, closely tracking essential economic cues and Federal Reserve statements for insights into the market’s direction. The comforting stance of the Fed and the struggling US Dollar are making Gold more appealing, opening doors for potential gains.
For traders, it’s crucial to stay sharp, observing changes in economic data and global events that might sway Gold prices in the weeks ahead. The present scenario underscores the importance of approaching the market cautiously and staying well-informed to adapt to any shifts that might come our way.