GOLD PRICE FORECAST: XAU/USD FLIRTS WITH $1,940 SUPPORT AFTER FED MOVES, US RETAIL SALES EYED...來自amking

17 Jun 2023, 15:51 · 閱讀量 36

Gold Price clings to mild gains while snapping three-day downtrend.
Federal Reserve’s hawkish halt defends XAU/USD bulls despite upbeat FOMC announcements.
China data-dump, United States Retail Sales eyed for clear directions of the Gold Price.
XAU/USD bears keep poking 100-DMA as bulls struggle to keep the reins.

Gold Price (XAU/USD) stays defensive around $1,945 as it prods the 100-DMA support after a three-day downtrend during the mid-Asian session on Thursday. That said, the United States (US) Federal Reserve (Fed) actions offered a volatile day and paused further downside of the XAU/USD but failed to push back the XAU/USD bears by offering a hawkish halt.

Gold Price suffers from Federal Reserve’s hawkish halt

Gold Price marked a quick $14.00 fall after the United States (US) Federal Open Market Committee (FOMC) kept the benchmark Fed rate unchanged at 5.0-5.25%, matching market expectations of pausing the multi-month-old hawkish cycle that propelled rates for 10 consecutive times.

The reason for the XAU/USD fall could be linked to the upbeat FOMC Economic Projections and Federal Reserve (Fed) Chairman Jerome Powell’s speech. That said, the dot plot rose 30 bps from March for 2024 and 2025 to 4.6% and 3.4% respectively while the median rate forecasts suggest two more rate increases in 2023. Further, no rate cuts nor recession is expected in the current year whereas the median estimation for the US Gross Domestic Product (GDP) rose to 1.0% from 0.4% in March. Additionally, Powell’s speech unveils a “meeting by meeting” approach for decision-making but signals July as a ‘live’ meeting, suggesting a 0.25% rate hike.

Following the Fed showdown, the markets remained volatile on late Wednesday, as well as on early Thursday. As a result, Wall Street closed mixed whereas the US 10-year Treasury bond yield eased 1.0 basis point (bps) to 3.79% but its two-year counterpart grinds higher at the three-month top to 4.70%. That said, the US Dollar Index (DXY) dropped to the lowest level in a week before bouncing off $1,939.75.

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