The price of gold (XAU/USD) hovers around $1,950 after retreating from its two-month high of $1,962 in early Asian trading on Thursday. This uptick in the precious metal's value is bolstered by escalating political tensions in the Middle East, driving a flow of safe-haven assets.
Simultaneously, the US Dollar Index (DXY), measuring the USD against six major currencies, rose to 106.55. Yields on US Treasury bonds surged, with the 10-year bond reaching 4.911%, the highest since 2007, while the 2-year bond maintained at 5.229%.
On Wednesday, Federal Reserve officials reiterated their commitment to maintaining interest rates. These comments resulted in higher US bond yields, indicating robust growth prospects in the US. Christopher Waller, a Federal Reserve Governor, stated that it's premature to determine the need for further policy rate action, suggesting a wait-and-see approach. New York Fed President John Williams emphasized the need for a restrained monetary policy for a while to cool down inflation, with the monetary policy trajectory contingent on data.
Furthermore, the political conflict between Israel and Hamas remains a focal point. On Tuesday, Gaza authorities reported that an Israeli airstrike had killed 500 people in a Palestinian hospital, while Israel claimed the casualties resulted from a Palestinian attack. The escalating political tension in the Middle East and market instability might drive demand for traditional safe-haven assets like gold.
Gold traders will closely monitor US Unemployment Claims, the Philly Fed Index, and Existing Home Sales data later on Thursday. Additionally, Fed Chair Powell is scheduled to speak. Market participants will interpret these signals from the data and seek trading opportunities around the gold price.
In this volatile climate, investors are navigating uncertain waters, seeking refuge in assets like gold amid global geopolitical uncertainties and shifting economic indicators. Stay tuned as the market continues to respond to unfolding events, shaping the trajectory of gold prices in the days to come.
Simultaneously, the US Dollar Index (DXY), measuring the USD against six major currencies, rose to 106.55. Yields on US Treasury bonds surged, with the 10-year bond reaching 4.911%, the highest since 2007, while the 2-year bond maintained at 5.229%.
On Wednesday, Federal Reserve officials reiterated their commitment to maintaining interest rates. These comments resulted in higher US bond yields, indicating robust growth prospects in the US. Christopher Waller, a Federal Reserve Governor, stated that it's premature to determine the need for further policy rate action, suggesting a wait-and-see approach. New York Fed President John Williams emphasized the need for a restrained monetary policy for a while to cool down inflation, with the monetary policy trajectory contingent on data.
Furthermore, the political conflict between Israel and Hamas remains a focal point. On Tuesday, Gaza authorities reported that an Israeli airstrike had killed 500 people in a Palestinian hospital, while Israel claimed the casualties resulted from a Palestinian attack. The escalating political tension in the Middle East and market instability might drive demand for traditional safe-haven assets like gold.
Gold traders will closely monitor US Unemployment Claims, the Philly Fed Index, and Existing Home Sales data later on Thursday. Additionally, Fed Chair Powell is scheduled to speak. Market participants will interpret these signals from the data and seek trading opportunities around the gold price.
In this volatile climate, investors are navigating uncertain waters, seeking refuge in assets like gold amid global geopolitical uncertainties and shifting economic indicators. Stay tuned as the market continues to respond to unfolding events, shaping the trajectory of gold prices in the days to come.
