Recent weakness in the USD saw Gold price testing $1,780. But the Federal Reserve’s commitment to bringing inflation down with tighter monetary policy leaves room for gains in the greenback, strategists at ANZ Bank report.
Fed to hike another 100 bps
“Softer than expected inflation in the US triggered a sell-off in the US Dollar, pushing Gold higher. Nevertheless, inflation remains well above the central bank’s target range of 2%. This leaves room for more tightening until inflation slows considerably.”
“US benchmark yields are rising and likely to move higher given the view of another 100 bps rate hike by the Fed. Investment demand is stabilising, with slowing ETF outflows and covering of short positions.”
“Physical demand for Gold is weakening, though central bank purchases remain strong.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.