Gold prices are advancing for the fourth consecutive day during the early European session on Tuesday. The yellow metal remains in positive territory despite the rebound of the US Dollar (USD) and higher bond yields. With markets closed in the US on Monday, trading activity was low, but investors are now awaiting cues from the Federal Open Market Committee (FOMC) Minutes scheduled for release on Wednesday, providing insights into the outlook for US interest rates.
As of now, gold is trading at $2,020, marking a 0.09% gain on the day. The US Dollar Index (DXY) shows modest gains near 104.35, while the 10-year Treasury yield stands at 4.30%. Stronger-than-expected recent US data has led investors to lower their expectations for rate cuts, supporting the USD.
Global central banks are likely to diversify their foreign reserves and accumulate gold amid ongoing geopolitical tensions in the Middle East and economic uncertainties. This could contribute to increased demand for gold, traditionally considered a safe-haven asset.
The release of the FOMC Meeting Minutes on Wednesday and the preliminary US S&P Global PMI for February on Thursday are anticipated events that could provide further direction to the gold price.
