Gold prices fell during these trading moments, today, Monday, after the statements of a member of the Federal Reserve put pressure on the precious metal on the one hand, and supported the US dollar on the other hand.
Meanwhile, gold is heading for monthly gains in conjunction with growing expectations that major global central banks may be nearing the end of the current monetary policy tightening cycles.
Also read: Reuters analysts change their expectations for gold in the coming period.. for these reasons!
Gold and the dollar now
Gold futures fell 0.3% to $1,994 an ounce.
While spot contracts fell by 0.14% to 1956 dollars an ounce.
On the other hand, the dollar index rose by 0.12% to 101,517 points.
gold when settling last week
Gold prices rose at the settlement of trading, on Friday, with the decline in the dollar index after the release of economic data that reflected the slowdown in inflationary pressures.
The data showed an increase in the basic personal consumption expenditures price index during June, by 4.1% on an annual basis, which was less than expectations for an increase of 4.2%, and compared to May, in which the index rose by 4.6%, which is the lowest level since September 2021. The Fed is the preferred indicator for predicting future inflation trends.
The data also showed the US Employment Cost Index - a broad measure of wages and benefits - rose by a seasonally adjusted 1.0% in the three months to June, below expectations of 1.1% and slowing from a 1.2% increase in the first quarter of 2018. this year.
In the same context, University of Michigan data revealed that the consumer confidence index increased by 11.2% on a monthly basis, at 71.6 points in the revised reading for July, compared to 64.4 points in the previous month, which is lower than the initial reading, up to 72.6 points. In general, the survey attributed Increased confidence points to the continued slowdown in inflation along with stability in the labor markets.
Upon settlement, gold futures contracts for August delivery increased by 0.75%, or the equivalent of $14.7, to reach $1960.4 an ounce, but it achieved a weekly loss of 0.3%.
An upward impetus awaits gold
“Markets feel confident in their assessment that Fed rates are at or near their final rate, because the headline inflation reports from the US all indicate that inflation is slowing,” said Matt Simpson, senior market analyst at City Index.
This has succeeded in supporting gold prices since it found support near the $1,900 level, Simpson added, noting that for a part of the year the market has typically been associated with volatile price action.
Gold prices are set to end the month on a high, as expectations that US interest rates may be nearing their peak pressurized the US dollar, heading for its second consecutive monthly decline.
Meanwhile, two ECB policymakers on Friday raised the possibility of ending the ECB's largest and longest series of interest rate increases.
Higher interest rates discourage buying non-interest-paying bullion, which is priced in dollars.
According to the Saudi Investing Fund's Fed Interest Tracker, markets are 61% to 80% likely to hold the monetary policy range at 5.25% and 5.50% for the remaining three meetings this year.
The next big catalyst for gold, outside of geopolitical risks, will be further progress on China's stimulus measures or the start of Fed rate cuts expected by the first quarter of next year, said Baden Moore, head of carbon and commodities strategy at the National Australia Bank.
Other precious metals also looked set to post monthly gains, with spot silver advancing 6.5%, but down 0.5% on the day at $24.22 an ounce. Platinum fell 0.9% to $927.38 and palladium slipped 0.3% to $1,241.93.
Fed remarks yesterday
Neil Kashkari, President of the US Federal Reserve in Minneapolis, said that the United States appears to be on its way to avoiding a recession, but it may see a slight rise in the unemployment rate as it continues to confront inflation.
Kashkari added, on Sunday, that he is not sure if the Fed has finished raising interest rates, and that monetary policy makers will use the data to form their opinions in this regard when they meet in September.
Kashkari said that the Fed has the intention to continue raising interest rates.
The President of the Federal Reserve Bank of Minneapolis assessed that inflation in the United States is on a downward path. However, he added that the hasty and preconceived judgment that inflation will end is not good.
