Investing.com – Gold prices fell slightly during these moments of trading on Tuesday, coinciding with the decline of the US dollar, as investors await more US economic data this week that could shed light on the US Federal Reserve’s monetary policy expectations amid market expectations. Increasing interest rates.
The US dollar fell nearly 0.1 percent against its rivals, making gold less expensive for holders of other currencies.
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Fed statements
The Fed signaled last week that the historic tightening of monetary policy designed over the past two years has come to an end and that borrowing costs will be lower in 2024.
Mary Daly, a member of the US Federal Reserve, said yesterday, Monday, that three interest rate declines in 2024 will be sufficient to avoid a scenario of excessive monetary tightening. Daly explained that the plan to lower interest rates may require extra caution if inflation reveals a halt in the decline in inflation.
Daly stated that the door is also open to a greater reduction than the three operations (75 basis points referred to in her speech and in Dot Plot) if inflation declines at a faster pace.
Daly drew attention to the need for the Federal Reserve to aim to reduce US labor market distributions if inflation continues to decline.
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Meanwhile, Chicago Fed President Austin Goolsbee said Monday in an interview on CNBC that markets may have misunderstood the central bank’s intended message last week after stocks and bonds rose sharply.
The Federal Reserve voted last week to keep interest rates steady again, and its updated forecasts showed an expectation of three rate cuts in 2024. That sent stocks and bonds soaring, with them jumping to a record high.
The Chicago Fed president also disputed the idea that the Fed is actively planning a series of interest rate cuts.
Goolsbee did not explicitly say that the market was pricing it wrong, but he highlighted this difference and misperception that the Fed was starting to consider a rate cut, expressing confusion over the market’s reaction last week.
Markets now expect about a 69 percent chance of a Fed rate cut in March, according to Investing’s Fed Rate Tracker. Low interest rates tend to support non-interest bearing bullion.
Investors are awaiting a series of US economic data this week, including the November core personal consumption spending index report, the Federal Reserve’s preferred measure of core inflation, due on Friday.
At the same time, it continued its gains, due to tensions in the Red Sea and Bab al-Mandab.
While the Central Bank of Japan decided a short while ago, today, Tuesday, to keep interest rates unchanged at the record level of minus 0.1%, in line with expectations.
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Gold at settlement yesterday
Prices turned higher at the settlement of trading yesterday, Monday, with stability at low levels, in light of increasing expectations that the Federal Reserve will end its monetary tightening cycle.
Upon settlement, gold futures prices for February delivery rose by 0.25%, or $4.8, at $2,040.5 per ounce, after touching $2,029.50 during trading.
Gold and dollar now
Gold futures are now down 0.07% to $2,039 an ounce.
It has now fallen by 0.08% to $2,025 per ounce.
On the other hand, the dollar index fell by 0.07% to 102.109 points.
other metals
Silver gained in spot transactions 0.1 percent to $23.80 per ounce, while platinum increased 0.3 percent to $948.18 and fell 0.2 percent to $1,181.85.
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2023-12-19 07:43:00
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