Price of Gold Fundamental Daily Forecast – Traders Adjusting to Lower Expectations of June Rate Cut

On Monday, gold prices are recovering from their lows following the release of a weaker-than-expected Empire State Manufacturing Index report. It came in at -8.6, well below the 12.1 forecast and 17.8 previous read. We’re not expecting major moves in Treasury yields or the stock market ahead of the Fed data on Wednesday, therefore, gold prices are likely to remain rangebound over the next two sessions.
James Hyerczyk
Gold Bars and Dollar

Gold futures are being pressured on Monday as investors adjust positions ahead of this week’s Federal Reserve interest rate decision and monetary policy statement on Wednesday. Traders are also watching the movement in U.S. Treasury yields, the U.S. Dollar and demand for riskier assets for direction. The Fed is expected to leave rates at current levels, which comes as a surprise to bullish gold traders who had been betting on an interest rate cut in June.

At 12:37 GMT, August Comex gold is trading $1343.20, down $1.30 or -0.10%.

After hitting a 14-month high on Friday, prices sold off sharply as expectations of a Fed rate cut fell following the release of stronger-than-expected U.S. retail sales data. The move produced a potentially bearish closing price reversal top that was confirmed earlier today.

Expectations of a rate cut at the U.S. Federal Reserve’s June 18-19 meeting fell to 21.7% from 28.3% on Thursday after the retail sales report, according to the CME Group’s FedWatch tool. But bets for monetary policy easing at the July meeting remain at 85%, and at the September meeting at 70%.

In other news, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.6% to 764.10 tonnes on Friday from 759.70 tonnes on Thursday.

Hedge funds and money managers also raised their net long positions in COMEX gold in the week to June 11, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

Daily Forecast

On Monday, gold prices are recovering from their lows following the release of a weaker-than-expected Empire State Manufacturing Index report. It came in at -8.6, well below the 12.1 forecast and 17.8 previous read.

Later today, traders will get the opportunity to react to the NAHB Housing Market Index and TIC Long-Term Purchases.

Gold traders will be eyeing the U.S. Dollar for direction because this is the market which drove the price action late last week. A correction in the dollar could trigger an intraday rally in gold prices.

We’re not expecting major moves in Treasury yields or the stock market ahead of the Fed data on Wednesday, therefore, gold prices are likely to remain rangebound over the next two sessions.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US