- Gold prices are hovering around $2330 an ounce today, Wednesday, after slipping in the previous session.
- Weaker-than-expected US retail sales data boosted expectations of imminent US Federal Reserve rate cuts.
- According to the results of the economic calendar, US retail sales rose by 0.1% in May, after a revised decline of 0.2% in April, missing expectations of 0.2%, indicating a slowdown in consumer sentiment.
Meanwhile, New York Federal Reserve President John Williams said on Tuesday that US interest rates will gradually decline, but he did not specify when the central bank will begin easing monetary policy. Now, investors are focusing on the weekly US jobless claims, due on Thursday, and the flash purchasing managers’ indexes on Friday for insights on consumption and economic strength.
Elsewhere, more central banks are planning to increase their gold reserves over the course of a year due to economic and political uncertainty, despite rising prices, according to a World Gold Council survey.
Impacting the gold market today, the DXY US Dollar Index is hovering around 105.3 today after falling for two consecutive sessions, with trading volumes expected to remain light as most US traders are out of the country for the holiday. Moreover, the dollar came under pressure on Tuesday as weaker-than-expected US retail sales data boosted bets that the Fed will have to cut rates soon.
According to an official announcement, US retail sales rose less than expected in May, while the previous month’s figures were revised much lower, suggesting a slowdown in economic activity in the second quarter.
Currently, markets see a roughly two-thirds chance that the Fed will start easing policy in September, with the US expected to cut interest rates about twice this year. Also, investors are looking ahead to the Bank of England’s policy decision later this week, when it is expected to keep rates steady before delivering its first rate cut in August.
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Gold Price Forecast and Analysis Today:
According to the performance on the daily chart above, the price of gold is still in an upward rebound range. Bulls will control the trend again if prices move towards the levels of $2355 and $2370 respectively. On the other hand moving below the $2300 level will be important in the downward shift. In general, we still prefer to buy gold from every downward level.
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