Gold Holds Steady At Around $2,570 As Investors Await Fed Decision

TLDR

Gold prices stabilized awaiting the U.S. Federal Reserve's interest rate decision, impacted by a robust U.S. Retail Sales report influencing the dollar and Treasury yields. XAU/USD held steady at $2,569 after hitting a record high on Monday, with market expectations predicting a possible rate cut by the Fed. Gold experienced a slight decline below $2,575, signaling the likelihood of further pullback potential based on Tuesday's performance.

Gold prices remained steady on Tuesday as the market awaited the U.S. Federal Reserve's interest rate decision on Wednesday.

Following a stronger-than-expected U.S. Retail Sales report for August, the U.S. dollar strengthened, and Treasury yields advanced, limiting the upside for gold. XAU/USD was flat at $2,569, after pulling back from Monday's record high of $2,590.

Market expectations for a 50 basis point rate cut by the Fed stand at 63%, while the chances of a 25 basis point cut are 37%, according to the CME FedWatch Tool. Gold's retreat below $2,575 on Tuesday led to a low of $2,561 during the session, indicating potential for a deeper pullback.

Key Takeaways

Gold's price remains steady, awaiting the Fed's rate decision. After hitting a record high on Monday, the metal pulled back amid rising U.S. Treasury yields and a stronger dollar. The potential for a rate cut by the Fed has fueled uncertainty in the market. Traders are eyeing key support levels at $2,532 and $2,520, where the 20-day moving average may provide a floor for prices. If gold drops below these levels, further downside could be tested. However, short-term weakness could find support, leading to renewed gains if market conditions stabilize.

Read the original article on Daba Finance.