Gold (XAU) Daily Forecast: Price Jumps to $2405; More Gains Ahead?

Looking ahead, traders are focusing on the upcoming release of the Empire State Manufacturing Index from the US, which could present short-term trading opportunities.

This anticipation comes ahead of Fed Chair Jerome Powell’s scheduled speech later in the North American session, expected to provide further insights into the Federal Reserve’s monetary policy stance.

Impact of US Dollar Strength on Gold Price Amid Fed Rate Cut Expectations

The US dollar gained strength despite widespread expectations that the Federal Reserve will start cutting interest rates in September, with a strong likelihood of another cut in December. Current market pricing indicates over a 90% chance of a September rate cut, bolstered by a tame US consumer inflation report released last Thursday.

Additionally, the US Bureau of Labor Statistics reported on Friday that the Producer Price Index (PPI) for final demand increased by 2.6% in June, exceeding the expected 2.3%.

Despite the anticipated Fed rate cuts and rising inflation, the US dollar’s strength could limit gold price gains as investors balance economic stability with potential interest rate adjustments.

Short-Term Forecast