Gold prices fell by $11 to $1,936 compared to yesterday morning, as the US dollar strengthened. The market is awaiting the Federal Reserve's two-day testimony on June 21-22 to gain insight into interest rate direction.
According to CME's Fedwatch tool, there is a 74% chance of a 25 basis points rate hike in July, bringing the rate to 5.25% - 5.50%, with rate cuts expected only in 2024. While gold is seen as a hedge against inflation, rising interest rates will increase the opportunity cost of holding non-yielding assets like gold.
According to Reuters technical analyst Wang Tao, if gold fails to break the $1,970 level, it may lead to a deep correction or a resumption of the downtrend from $1,983. While gold is struggling to gain momentum, analysts note that its strength currently depends on market support levels.
According to CME's Fedwatch tool, there is a 74% chance of a 25 basis points rate hike in July, bringing the rate to 5.25% - 5.50%, with rate cuts expected only in 2024. While gold is seen as a hedge against inflation, rising interest rates will increase the opportunity cost of holding non-yielding assets like gold.
According to Reuters technical analyst Wang Tao, if gold fails to break the $1,970 level, it may lead to a deep correction or a resumption of the downtrend from $1,983. While gold is struggling to gain momentum, analysts note that its strength currently depends on market support levels.
