- The appetite for the risk is recovered while Trump exonerates some automotive tariffs, generating hopes of a commercial agreement.
- The weak US GDP and unemployment applications feed fears of recession, but inflation remains close to the 2% target of the Fed.
- Markets discount 90 basic points of feat cuts from the Fed; Now the attention is in the non -agricultural payroll report on Friday.
The price of gold fell about $ 70, or 2%, on Thursday, since the appetite for risk improved during the American session. Commercial tensions between the United States (USA) and their counterparts relax, keeping optimistic investors for the rest of the week. At the time of writing, the XAU/USD quote $ 3,226.
Commercial tensions between the US and China softened when revealed that Washington was contacting Beijing to start negotiations. The decision of the US President Donald Trump to exonerate some tariffs of the automotive industry and the advances in agreements with India, South Korea and Japan were celebrated by the investors who bought the dollar to the detriment of the precious metal.
Wednesday’s data painted a gloomy economic panorama for the US, since the GDP of the first quarter of 2025 contracted and an inflation measure for the same period increased. However, the Personal Consumption Expenditure Index (PCE), sought by the Fed as the preferred inflation indicator, remained unchanged, within the 2%range.
Although this was favorable for gold, the positive profits of US companies maintain positive feeling. However, Wall Street profits remained limited since business activity in the manufacturing sector disappointed the operators. This and the increase in Americans who request unemployment benefits fed recession fears before the publication of the non -agricultural payroll report on Friday.
After the publication of the data, the investors rushed to discount 90 basic points of feat cuts from the Fed, as revealed by Prime Market Terminal data.
Fountain: Prime Market Terminal
Facing the week, operators are attentive to the publication of non -agricultural payroll figures in April.
What moves the market today: the price of gold drops while the yuos treasury yields
- The recently published data pushed the prices of US bonds downward, increasing the yields of US Treasury bonds. The 10 -year Treasury bonus yield of the US Treasury rose six basic points, reaching 4,229%. At the same time, US real yields increased by six PB to 1.99%, as shown in the yields of treasure inflation to 10 years of 10 years.
- The manufacturing PMI of the Supply Management Institute (ISM) was greater than estimates of 48 and rose to 48.7, getting off the reading of March 49. Timothy Fiore, president of the ISM Manufacturing Business Business Survey Committee, revealed that demand and production retreated while the dismissals continued. He added: “Price growth accelerated slightly due to tariffs, causing delays in the placement of new orders, slow suppliers and growth in the manufacturing inventory.”
- Initial unemployment applications for the week that ended on April 26 increased to 241K, much more than the 224K expected and above 223K revealed a week ago.
XAU/USD technical perspective: The price of gold is prepared for a setback below $ 3,250
The price of gold seems to be experiencing a setback since buyers failed to defend the minimum oscillation of April 23, $ 3,260, exposing the $ 3,200 mark. The relative force index (RSI) is falling towards its neutral line, insinuating that sellers are intervening.
Therefore, if the Xau/USD exceeds $ 3,200, the following support would be the maximum of April 3, which became support in $ 3,167. Once surpassed, the next stop would be the Simple Mobile (SMA) of 50 days, at 3,080 $.
On the contrary, if buyers raise gold prices above $ 3,300, would clear the way to challenge the $ 3,350, followed by $ 3,400.
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.
