Following the FOMC’s monetary policy pronouncement on Wednesday, anti-fiat gold prices have risen in the last 24 hours. As expected, the central bank kept benchmark lending rates and the pace of quantitative easing constant. The US Dollar and Treasury yields fell as a result of the statement’s specifics and Chair Jerome Powell’s news conference.

Given that XAU/USD is a non-yielding asset, it tends to benefit when both of the latter are declining. The Fed elicited a kneejerk reaction. The central bank stated that the economy had progressed toward its maximum employment and price stability goals, which initially frightened markets. Policymakers have stated that they are on the verge of tapering.

However, the attitude immediately changed as it became evident that the central bank is still very dovish. Powell stated that significant further development in the job market is still a long way off. Inflation, he repeated, is just temporary. Treasury yields fell sharply as his remarks appeared to imply that tapering is still a ways off, causing the drachma to rise. Over the next 24 hours, the first estimate of US second-quarter GDP will be released. Annualized increase will be 8.5 percent q/q, up from 6.4 percent the previous quarter. Since April, Atlanta’s Fed GDPNow Q2 real growth estimate has been going lower, and it now stands at 6.4 percent. A weaker-than-expected result could add to the central bank’s hesitancy. If bond rates continue to fall as a result of this, gold could continue to rise.

On the 4-hour chart below, gold prices recently penetrated a near-term falling trendline from earlier this month, indicating that they may be poised to extend current advances. This comes after a period of bullish RSI divergence, indicating that the downward momentum was receding. If prices continue to rise, they may reach their all-time high of 1834 on July 15th. XAU/USD would then rise above the 200-period Simple Moving Average.

Latest articles

Paytm and HDFC Bank have teamed up to explore payment solutions for new online businesses

Paytm, the IPO-bound digital payments company, and HDFC Bank, India's largest private sector bank, announced a strategic partnership to develop comprehensive solutions...

For the first time in three months, Bitcoin has surpassed $50,000

On Monday, Bitcoin surpassed $50,000 for the first time in three months, as investors flocked back into the cryptocurrency on a bargain-hunting...

50 Government schools transformed in Odisha, 1000 underway

Under the 5-T initiative, Odisha Chief Minister Naveen Patnaik has changed 50 government high schools in the Hinjilicut and Sheragada Blocks in...

WhatsApp’s Desktop App Has Been Released To The Public Beta Program

WhatsApp, like most other apps, is subjected to beta testing. This is crucial because they need to ensure that the software works...

Related articles

Leave a reply

Please enter your comment!
Please enter your name here