Gold (XAU/USD) began attracting buyers on Tuesday after a sharp two-day fall that briefly touched the $4,400 area its lowest level since January 6. This recovery was aided by a slight weakening of the US dollar, moving away from its more than one-week peak reached on Monday.
However, the dollar's strength is likely to persist. Donald Trump's appointment of Kevin Warsh as the next Federal Reserve Chair coupled with solid US manufacturing data is seen as encouraging the Fed to remain cautious about lowering interest rates. This combination tends to act as a drag on gold's momentum.
On the sentiment side, the market is also beginning to enter a calmer mode. Signs of a US - Iran de escalation and news of a US-India trade deal have improved risk appetite, reducing the demand for safe haven assets like gold. This means there is room for gold to rise, but it could quickly bottom out if the market perceives global risks to ease.
Another pressure comes from margin policy. CME Group raised margin requirements for precious metals futures contracts, triggering two consecutive days of liquidations. As a result, gold was briefly dragged lower, and the market is now tending to be more selective about adding new positions.
Data wise, the Institute for Supply Management reported that US factory activity has resumed expansion: the manufacturing PMI rose to 52.6 from 47.9. This figure reinforces the narrative that the US economy is not yet "cooling off," which typically leads to expectations of less aggressive monetary easing again a limiting factor for gold.
Looking ahead, market participants will be monitoring the JOLTS (job openings) release on Tuesday, followed by ADP data and the ISM services PMI on Wednesday, plus comments from Fed officials. If the dollar strengthens again, gold could become a burden; but if the dollar weakens and volatility subsides, gold's recovery is likely to continue although the market still needs strong buying evidence to conclude that the correction phase is truly over. (Asd)[sma]
Source : Newsmaker.id
Gold prices weakened slightly on Thursday (February 12th), as more solid US employment data reduced market confidence in an imminent Federal Reserve interest rate cut. The strong employment data promp...
Gold prices strengthened on Wednesday, supported by a weaker US dollar and falling US bond yields after the latest economic data reinforced the narrative that the Federal Reserve is likely to continue...
Gold experienced a slight correction in the European session on Tuesday (February 10th), but remained above $5,000/oz as the market held its breath ahead of a series of US data that could alter intere...
Gold held above the psychological $5,000 level at the start of the week, supported by a combination of factors that are "right" for the precious metal : physical demand from China, expectations of low...
Gold prices are still struggling to turn an intraday rebound into a sustained rally. After briefly falling to $4,654 (a four day low) and rebounding, prices were again rejected near $4,900. In the Eur...
Oil prices stabilized on Thursday (February 12th), as the market reassigned a risk premium to US-Iran tensions despite US inventory data showing swelling domestic supplies. This movement confirms one thing: geopolitical headlines are still more...
Gold prices weakened slightly on Thursday (February 12th), as more solid US employment data reduced market confidence in an imminent Federal Reserve interest rate cut. The strong employment data prompted market participants to shift expectations of...
The Hang Seng Index reversed its downward trend in Hong Kong on Thursday (February 12th), weakening by around 0.9% to around 27,000 after a strong session earlier. This decline halted the momentum of the short term rally, as investors began to...