Investors await Federal Reserve chair’s testimony before Congress and June inflation data to assess the next policy move by the US central bank.
09 July 2024 - 07:29
byAshitha Shivaprasad
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Bengaluru — Gold prices inched higher on Tuesday after a sharp drop in the previous session, with investors awaiting Federal Reserve chair Jerome Powell’s testimony before Congress and June inflation data to assess the next policy move by the US central bank.
Spot gold was up 0.1% at $2,361.77/oz by 2.08am GMT, after falling more than 1% on Monday. US gold futures firmed 0.3% to $2,369.70.
Powell will deliver two days of testimony before Congress, beginning later in the day with the Senate and followed by the House on Wednesday.
“After recent weak data, the market has high hopes for two rate cuts before the year ends. If Powell directly or indirectly implies that weakness is seeping through the US economy, then it will be positive for gold,” said Kelvin Wong, a senior market analyst for Asia Pacific at Oanda.
A jobs report on Friday showed that the US labour market was losing steam as the unemployment rate climbed to 4.1%.
Markets are pricing in a 77% chance of a rate cut in September and a second one by December, according to CME’s Fedwatch Tool.
Non-yielding bullion’s appeal tends to shine in a lower interest rate environment.
Meanwhile, a Federal Reserve Bank of New York report said the path US inflation is expected to follow over coming years generally softened in June, amid retreating projections of price increases for a wide array of consumer goods and services.
Market participants were also awaiting June consumer (CPI) and producer (PPI) price indices data scheduled to be released on Thursday and Friday, respectively.
Softer inflation readings could see gold prices test the minor congestion resistance level of $2,410 in the short term, Wong said.
Among other metals, spot silver rose 0.2% to $30.84/oz, platinum edged 0.9% higher to $1,005.25 and palladium gained 0.1% to $1,009.93.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Gold inches up ahead of Jerome Powell’s testimony
Investors await Federal Reserve chair’s testimony before Congress and June inflation data to assess the next policy move by the US central bank.
Bengaluru — Gold prices inched higher on Tuesday after a sharp drop in the previous session, with investors awaiting Federal Reserve chair Jerome Powell’s testimony before Congress and June inflation data to assess the next policy move by the US central bank.
Spot gold was up 0.1% at $2,361.77/oz by 2.08am GMT, after falling more than 1% on Monday. US gold futures firmed 0.3% to $2,369.70.
Powell will deliver two days of testimony before Congress, beginning later in the day with the Senate and followed by the House on Wednesday.
“After recent weak data, the market has high hopes for two rate cuts before the year ends. If Powell directly or indirectly implies that weakness is seeping through the US economy, then it will be positive for gold,” said Kelvin Wong, a senior market analyst for Asia Pacific at Oanda.
A jobs report on Friday showed that the US labour market was losing steam as the unemployment rate climbed to 4.1%.
Markets are pricing in a 77% chance of a rate cut in September and a second one by December, according to CME’s Fedwatch Tool.
Non-yielding bullion’s appeal tends to shine in a lower interest rate environment.
Meanwhile, a Federal Reserve Bank of New York report said the path US inflation is expected to follow over coming years generally softened in June, amid retreating projections of price increases for a wide array of consumer goods and services.
Market participants were also awaiting June consumer (CPI) and producer (PPI) price indices data scheduled to be released on Thursday and Friday, respectively.
Softer inflation readings could see gold prices test the minor congestion resistance level of $2,410 in the short term, Wong said.
Among other metals, spot silver rose 0.2% to $30.84/oz, platinum edged 0.9% higher to $1,005.25 and palladium gained 0.1% to $1,009.93.
Reuters
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