Gold Price Forecast: XAU/USD traders await key US events

Gold price was a touch lower on Monday towards the close on Wall Street. closed with a small loss on Monday as the dollar moved higher ahead of the Wednesday end of the two-day meeting of the Federal Reserve's policy committee. At the time of writing, Gold price was 0.11% offered and had travelled between a high of $1,967.01 and reached a low of $1,949.28.

The main focus for the week will be on the US Consumer Price Index on Tuesday and then the outcome of the Federal Reserve's two-day meeting.  The CME Fedwatch tool seeing a 74% chance the meeting will end Wednesday without another rise in interest rates.

''is likely to come down to the wire, but we maintain our long-held view that the Fed will tighten by a final 25bp in June to a range of 5.25%-5.50%. If the Fed decides to 'skip' the June meeting, we expect the decision to be accompanied by communication that leans hawkish (ie. statement, dot plot, and presser), signaling a likely hike in July,'' analysts at TD Securities explained.

Meanwhile, the May inflation rate on Tuesday will be a key focus and could shift the needle in that regard. Markets are expecting prices last month to have risen by 4% annualized last month, this is lower than the 4.9% marked in April.

''Core prices likely stayed firm in May, with the index rising a strong 0.4% m/m for a second straight month, also matching the m/m avg since June 2022,'' analysts at TD Securities said. ''Goods inflation likely stayed positive, with shelter prices remaining the key wildcard (expect slowing). Retreating gas prices (-6% MoM) will drag non-core inflation. Our m/m forecasts imply 4.0%/5.3% YoY for total/core prices.''

Leading into the events, bond yields were mixed. The US two-year note was last seen paying 4.577%, down 2.9 basis points, while the 10-year note was up 3.0 points to 3.772%. The ICE dollar index was last seen trading near 103.62 after moving up from a low of 103.242 and scoring a nearby high of 103.75. 

Gold technical analysis

The price is trapped between key breakout support and resistance as illustrated in the daily and 4-hour charts above.