Advertisements
Home Gold News Gold Price Rises Amid Weakening US Dollar, Fed’s Rate Decision in Focus

Gold Price Rises Amid Weakening US Dollar, Fed’s Rate Decision in Focus

by anna

In the early New York session on Monday, the price of gold (XAU/USD) saw a slight increase as the US Dollar encountered downward pressure. The US Dollar Index (DXY) traded marginally lower at 103.40, driven by an improved risk appetite in the market.

The boost in risk sentiment came as a result of robust recovery in Chinese Retail Sales and Industrial Production data for February, indicating a strengthening in China’s domestic demand and bolstering the appeal for risk-sensitive assets.

Advertisements

However, expectations for the Federal Reserve (Fed) to implement interest rate cuts during the June policy meeting have diminished, leading to an uptick in yields on interest-bearing assets. The yield on 10-year US Treasury bonds has extended its upward trajectory to 4.33%, marking a 0.45% increase. Elevated US bond yields often elevate the opportunity cost of holding non-yielding assets like gold.

Advertisements

This week, the trajectory of gold prices will largely be influenced by the outcome of the Fed’s interest rate decision, scheduled to be announced on Wednesday. The Fed is widely expected to maintain interest rates within the range of 5.25% to 5.50%. However, investors will closely scrutinize the interest rate guidance provided through the release of the “dot plot,” which presents interest rate projections from Fed officials for various timeframes.

Advertisements
Advertisements

You may also like

Lriko logo

Lriko is a gold portal website, the main columns include gold pricespot goldsilver pricespot silvergold futures, nonfarm payroll, gold basics, gold industry news, etc.

© 2023 Copyright  lriko.com