Gold Price Forecast: XAU/USD may be on the defensive unless geopolitical risks increase – HSBC

FXStreet Insights Team FXStreet

Caught in the twin grip of elevated US yields and a stronger USD, Gold may be on the defensive over the near term unless geopolitical risks escalate, economists at HSBC report.

Increasing geopolitical risks could help sustain Gold price

We are not convinced the rally can be sustained beyond the near term. Oil prices have eased for three days in a row (Bloomberg, 24 October 2023). This may be key, as it is difficult to envisage much greater geopolitical risk-led demand for Gold if Oil prices are easing.

Gold is historically sensitive to US real yields and, while there could be a disconnect in this relationship, it has re-emerged and is likely to weigh further on Gold.

As we expect ongoing USD strength, this will likely limit Gold rallies and may even act to press XAU/USD lower.

Escalating geopolitical and trade risks are playing an increasingly supportive role in Gold prices, engineering rallies that are likely to stay high in 2024.

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD bounces back toward 0.6950 on fresh USD supply

AUD/USD bounces back toward 0.6950 in the Asian session on Friday. The US Dollar retreats from 17-month highs as traders take profits off the table ahead of the all-important US Nonfarm Payrolls report. Meanwhile, the Australian Dollar draws support from reviving expectations of a November interest rate hike amid elevated global yields and inflation risks.

USD/JPY struggles near 158.00 as USD retreats ahead of NFP

USD/JPY is struggling for fresh impetus near 158.00, moving away from the top end of its weekly range in the Asian session on Friday, after hotter-than-expected Tokyo CPI and amid a broad US Dollar retreat. Traders reposition themselves ahead of US Nonfarm Payrolls.

Gold fades the earlier optimism; back below $4,200

Gold could not sustain the post-NFP bull run past the $4,200 mark per troy ounce, receding toward the $4,180 region at the end of the week. The precious metal’s inconclusive price action comes amid fresh selling pressure hurting the US Dollar as investors assess the latest NFP data.

Crypto Today: Bitcoin, Ethereum and XRP gains reinforce bullish outlook

Cryptocurrency prices are broadly recovering on Friday, led by Bitcoin moving above $86,000. Ethereum has reaffirmed its bullish outlook, rising above $2,700 while the immediate area at $2,800 caps upside. Meanwhile, Ripple hovers near $1.54.

Week ahead – Fed minutes in the spotlight amid bond market rout

Energy crisis and soaring bond yields to stay in driver’s seat in quiet week. Fed minutes eyed after drop in October rate hike bets. ISM services PMI and Treasury auctions to be watched too. Canadian employment, Japanese wages and ECB minutes also on tap.

The Euro is near a one-year low: Inflation could trigger its rebound, not its fall

EUR/USD has fallen to its lowest level since May 2025. The pair hit 1.1312 on Wednesday and trades well below the January peak of 1.2082. The decline reflects a powerful combination of US Dollar strength, geopolitical uncertainty and renewed concerns about Europe's exposure to higher energy prices.