The Gold price (XAU/USD) experienced a slowdown as the US Dollar (USD) staged a modest recovery on Wednesday. Nevertheless, the rising geopolitical tensions in the Middle East are anticipated to act as a mitigating factor, helping to constrain potential losses.
Moreover, sentiments surrounding the precious metal received a boost following US Federal Reserve (Fed) Chair Jerome Powell’s recent address at the Jackson Hole symposium. Powell’s indication that the “time has come” to initiate interest rate reductions could bolster the appeal of gold by diminishing the opportunity cost associated with holding assets that do not yield interest.
Investors are keenly awaiting insights from the speeches of Fed officials Christopher Waller and Raphael Bostic scheduled for Wednesday, as they seek clues regarding the future trajectory of US interest rates. The market focus is expected to shift towards the second estimate of the US Gross Domestic Product (GDP) Annualized for the second quarter (Q2) and the release of the Personal Consumption Expenditures (PCE) Price Index data on Thursday and Friday, respectively. Should these reports surpass expectations, there may be a strengthening of the US Dollar (USD), potentially limiting the upward movement of the USD-denominated Gold price.
