Gold Prices Tightly Bound as Traders Await US Economic Data
London: 25 October 2023 (TraderMade): Gold prices remained entrapped within a tight trading range of just $10 on Wednesday, with investors displaying caution and restraint as they awaited crucial US economic data scheduled for release later this week. This data is expected to provide further insights into the Federal Reserve's stance on interest rates.
Gold's current status
On Monday - 23 October, Gold (XAUUSD) rose up to 1982.85 and closed at 1972.995. Yesterday, it reached 1980.935 and closed at 1971.17993. At about 01:03 PM GMT, Gold is at 1975.2424.
Influencing elements
Geopolitical tension due to ongoing conflict in the Middle East is among the significant reasons making the investor community cautious. The economic data from Europe was disappointing. These forces promote a safe-haven appeal for gold.
At the same time, the financial world awaits the Fed Reserve's next moves. Any further tightening of monetary policy, leading to an increase in interest rates, would bolster the US Dollar. However, keeping high rates for a long duration may cause a decline in Gold.
Survey data released on Tuesday revealed a contrasting picture, with US business activity on the rise in October while the eurozone encountered an unexpected downturn in output.
As we look ahead, market attention has now shifted towards the forthcoming release of the US third-quarter GDP figures slated for Thursday, followed by the US PCE price index due on Friday.
Simultaneously, the dollar index saw a 0.2% gain against other currencies, subsequently rendering gold more expensive for holders of alternative currencies.
