GOLD:Hits a monthly low amid high US Treasury bond yields.

16 Şub 2023

The gold price (XAU/USD) is still around $1,835 after posting the biggest daily drop in two weeks near the 1.5-month low. The yellow metal reflects the market's inaction on Thursday morning. Nonetheless, it remains on the bear's radar in the face of firmer US Treasury bond yields and the US Dollar in the face of hawkish Federal Reserve (Fed) bets.

Gold price falls as US data propels Treasury bond yields, US Dollar Despite recent inaction, the gold price remains on the bear's radar as upbeat US economic data underpins the hawkish bias surrounding the Federal Reserve's (Fed) next moves and fuels US Treasury bond yields, as well as the US Dollar.

Nonetheless, US retail sales increased by 3.0% year on year in January, compared to 1.8% expected and -1.1% previously. Furthermore, Retail Sales Excluding Autos increased by 2.3% in the same period, exceeding analysts' expectations of +0.8%. Similarly, the NY Empire State Manufacturing Index for February rose to a three-month high of -5.8 from -18.0 expected and -32.9 market forecasts. Alternatively, the US Industrial Production marked 0.0% MoM figures for January, compared to analysts' estimates of 0.5% and -0.7% previous readings, but failed to counteract the Fed's (Fed) hawkish bias.

In light of the data, US 10-year Treasury bond yields oscillate around a six-week high set the previous day, while bulls in the US Dollar Index (DXY) take a breather after reaching a 1.5-month high as key US data points to a further increase in the Federal Reserve's (Fed) interest rates.

However, market bets on the Fed's next moves, according to Reuters' FEDWATCH tool, suggest that US central bank rates will peak in July around 5.25%, versus the December Federal Reserve prediction of 5.10%.

Geopolitical tensions and a light calendar are also weighing on the XAU/USD.
Aside from the data-backed broad US Dollar strength, the lack of major catalysts, ongoing US-China tensions, and US political risks all put downward pressure on the gold price.

The ongoing discussion about the balloon shooting and the story behind the US-China spying has recently soured the mood. Fears of a US debt-ceiling crisis, as warned by the US Congressional Budget Office (CBO) on Wednesday, may be along the same lines.

There is nothing significant to watch for gold traders ahead of the FOMC Minutes.
Moving on, gold traders can be entertained by second-tier US data on the housing market, industrial activity, and producer prices ahead of next week's Minutes of the latest Federal Open Market Committee (FOMC) monetary policy meeting. It's worth noting that the recent increase in Fed bets, combined with positive data, keeps XAU/USD bulls optimistic until then.

16 Şub 2023

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16 Şub 2023

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