Gold price ticks lower on Monday amid hawkish Fed expectations and a positive risk tone. A modest USD downtick helps limit the downside amid persistent geopolitical tensions. Traders also seem reluctant ahead of the FOMC meeting and key US macro data this week.
Gold price (XAU/USD) struggles to capitalize on its modest gains registered over the past two trading days and oscillates in a narrow trading band during the early European session on Monday. The US Personal Consumption Expenditures Price Index released on Friday pointed to still sticky inflation and reaffirmed market expectations that the TradingPro will keep interest rates higher for longer. This, along with a generally positive tone around the equity markets, turns out to be a key factor undermining demand for the safe-haven precious metal.
Meanwhile, the US Dollar comes under some renewed selling pressure and hangs near a two-week low touched on Friday amid a sharp recovery in the Japanese Yen, bolstered by a possible government intervention. Apart from this, persistent geopolitical tensions stemming from the protracted Russia-Ukraine war and Israel-Hamas conflict act as a tailwind for the safe-haven Gold price. Traders might also prefer to wait on the sidelines ahead of a two-day FOMC meeting starting on Tuesday and this week’s key US macro data, including the Nonfarm Payrolls report.
