Gold prices (XAU/USD) are continuing their recovery from the $2,500 level, gaining traction on Thursday. This upward movement is bolstered by increasing expectations that the Federal Reserve (Fed) will initiate a policy-easing cycle and cut borrowing costs in its upcoming meeting. However, diminished speculation about a more aggressive rate cut at the September 17-18 Fed policy meeting has strengthened the US Dollar (USD), potentially limiting further gains for gold.
Additionally, the positive sentiment in equity markets is likely to diminish the allure of safe-haven assets like gold, discouraging traders from making bold bullish moves.
The metal’s recent price movements and ongoing challenges to maintain levels above the $2,530-2,532 range—the peak reached in August—suggest that it may be prudent to wait for stronger buying momentum before pursuing further gains. Traders are now looking to the US Producer Price Index (PPI) for new market direction.
