Gold Price Forecast: ‘Sell the fact’ on disastrous US Q2 GDP?
Gold (XAU/USD) witnessed another attempt to the upside on Wednesday and tested the record highs of $1981.34 after the US Federal Reserve (Fed) struck a dovish tone, as widely expected. The Fed pledged to keep the monetary policy accommodative for an extended period and warned that “the path of the economy will depend significantly on the course of the virus.” The US 10-year real yields dropped to an all-time low of -0.95%, downing the US dollar to fresh two-year lows while boosting the non-yielding gold.
On Thursday, the yellow metal eased, as the Fed’s dovishness lifted the sentiment on the global markets, although the optimism was capped by the US fiscal wrangling and nervousness ahead of the key US Q2 Preliminary GDP report, due later today at 1230 GMT. The US economy is likely to see the steepest contraction (34.1% annualized) since 1929 in Q2 due to the coronavirus pandemic. Read More...
Gold consolidates as risk appetite picks up
Gold traded lower early on Thursday, as investor mood was buoyed by the dovish stance of the Federal Reserve. On Wednesday, the Fed committed to leave interest rates near zero and pledged to use all its tools to support an economic recovery. Members of the Fed’s policy-setting committee voted unanimously to keep the target range for short-term interest rates at between 0% and 0.25%.
At a news conference on Wednesday, Fed chair Jerome Powell said: “The path forward for the economy is extraordinarily uncertain and will depend in large part on our success in keeping the virus in check.” He added; “there’s probably going to be a long tail where a large number of people are struggling to get back to work.” He made it clear that the Fed is “not even thinking about thinking about thinking about” raising rates. Read More...
Gold Price Analysis: XAU/USD flirts with session lows near $1950, US GDP in focus
Gold extended its steady intraday slide and was last seen hovering near the lower end of its daily trading range, just above the $1950 level.
The precious metal witnessed some profit-taking on Thursday and has now erased the previous day's positive move to the $1981 area, or record highs retested in the aftermath of a more dovish Fed commentary. The US central bank reiterated to keep rates near zero until it is confident that the economy has weathered the recent events, which, in turn, underpinned the non-yielding yellow metal. Read More...
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