- Gold goes back for the second day while operators ensure profits and the US dollar is strengthened.
- Fed officials adopt a cautious tone, indicating that there is no hurry to cut rates due to uncertainty for Trump’s tariffs.
- Geopolitical risks intensify as Israel intensifies attacks in Gaza, ending a two -month fire and increasing the market tension.
The price of gold goes back for the second consecutive day, but is prepared to finish the week in positive in the middle of the general fortress of the US dollar (USD) and the operators ensuring profits before the weekend. The XAU/USD quotes at $ 3.019, with a fall of 0.81%.
The mood on the market is still pessimistic, although US actions are cutting some of their previous losses. The ingot remains defensive since the dollar seems to have found its stability, with the US dollar index (DXY) in 104.05, rising 0.24%.
The lack of a catalyst keeps operators focused on the main engine of the markets, the commercial policies of President Donald Trump. Apart from this, even Federal Reserve officials (Fed) who have crossed the news have not impacted gold prices.
The president of the Fed in New York, John Williams, commented that the 2% objective of the Central Bank is not in debate or discussion, adding that the current moderately restrictive monetary policy is “totally appropriate.” Later, the president of the Fed of Chicago, Austan Goolsbee, declared that when there is a lot of uncertainty, things should be expected.
The comments of those responsible for policies joined what Powell said, that the Fed is not in a hurry to cut the interest rates. This indicates that officials feel comfortable with the level of fees. However, they affirmed that they are still uncertain about the response of the economy to tariffs recently applied to certain products imported to the US.
On Wednesday, Fed officials updated their projections on interest rates, providing two cuts in 2025 while checking the economy.
As for geopolitics, Israel announced an escalation of hostilities in Gaza to press the release of the remaining hostages, effectively abandoning a high two -month fire and throwing an attack against Hamas.
What moves the market today: gold bulls take a break while the rebound stops
- The yields of the US Treasury bonds are rising, weighing on the prices of the ingot. The 10 -year bonus of US bonus rises a basic point to 4,246%.
- The real US yields, measured by the performance of treasure values ​​against 10 -year inflation that correlates inversely with gold prices, almost 2 basic points rise to 1,918%.
- The Summary of Economic Projections revealed that FED officials anticipate two feat cuts in 2025, maintaining the projection of the federal funds rate by 3.9%, without changes with respect to December projections. The Personal Consumption Expenditure Index (PCE) – the inflation indicator preferred by the FED – and the unemployment rate were reviewed upwards, while GDP growth is now projected that it will fall below 2%, pointing out a deceleration linked to the commercial policies of President Donald Trump.
- The money market has incorporated 72 basic relaxation points of the Fed in 2025, which has led to the yields of the US Treasury bonds to fall along with the US currency.
Technical perspective of the Xau/USD: The price of gold conquers the $ 3,000, ready to finish the week above that level
Gold price trends remain bullish. It could be prepared for a setback unless buyers push the price above Friday’s opening of $ 3,043. The momentum remains bassist, as indicated by the relative force index (RSI) that falls sharply for the second consecutive day, exceeding the previous index threshold. This suggests that bassists are in command.
If the Xau/USD falls below $ 3.020, the following support would be the $ 3,000 mark. Once surpassed, the following area of ​​interest would be the daily maximum of February 20 in 2,954 $, followed by the mark of $ 2,900.
On the contrary, a rebound above $ 3,050 could open the door to a rally towards the resistance zone of $ 3,100.
FAQS GOLD
Gold has played a fundamental role in the history of mankind, since it has been widely used as a deposit of value and a half of exchange. At present, apart from its brightness and use for jewelry, precious metal is considered an active refuge, which means that it is considered a good investment in turbulent times. Gold is also considered a coverage against inflation and depreciation of currencies, since it does not depend on any specific issuer or government.
Central banks are the greatest gold holders. In their objective of supporting their currencies in turbulent times, central banks tend to diversify their reserves and buy gold to improve the perception of strength of the economy and currency. High gold reserves can be a source of trust for the solvency of a country. Central banks added 1,136 tons of gold worth 70,000 million to their reservations in 2022, according to data from the World Gold Council. It is the largest annual purchase since there are records. The central banks of emerging economies such as China, India and Türkiye are rapidly increasing their gold reserves.
Gold has a reverse correlation with the US dollar and US Treasury bonds, which are the main reserve and shelter assets. When the dollar depreciates, the price of gold tends to rise, which allows investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rebound in the stock market tends to weaken the price of gold, while mass sales in higher risk markets tend to favor precious metal.
The price of gold can move due to a wide range of factors. Geopolitical instability or fear of a deep recession can cause the price of gold to rise rapidly due to its condition of active refuge. As an asset without yield, the price of gold tends to rise when interest rates lower, while the money increases to the yellow metal. Even so, most movements depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (Xau/USD). A strong dollar tends to keep the price of gold controlled, while a weakest dollar probably thrusts gold prices.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
