Gold (XAU/USD) extends its steady intraday descent through the first half of the European session on Wednesday and slides further below the $3,665 level, hitting a fresh daily low in the last hour.
The US Dollar (USD) stages a modest bounce from its lowest level since early July amid some repositioning trade ahead of the pivotal FOMC decision and exerts some pressure on the precious metal. The commodity now seems to have snapped a three-day winning streak to the all-time peak touched on Tuesday, though the downside remains cushioned.
Investors now seem convinced that the US Federal Reserve (Fed) will resume its rate-cutting cycle later today and deliver two more rate cuts by the end of this year amid signs of a softening labor market. This might keep a lid on any further USD gains and offer some support to the non-yielding Gold.
Apart from this, geopolitical risks stemming from the intensifying Russia-Ukraine war and conflicts in the Middle East may contribute to limiting losses for the safe-haven precious metal. This, in turn, warrants some caution for the XAU/USD bears.
Source: Fxstreet
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