Trending
Gold
Source: Newsmaker.id
Gold prices strengthened again during Wednesday's trading (Sept 16) after declining over the previous two days. XAU/USD rose more than 1% to above US$4,340 per troy ounce, while spot gold traded around US$4,324.01 during the London session.
Support for gold came from a drop in oil prices after a previous sharp rally began to lose momentum. The oil price correction slightly eased concerns regarding energy-driven inflation, which had previously been a major source of pressure on bullion.
US Treasury yields also began to decline after previously hitting their highest levels in nearly two decades. Yields on 10-year and 2-year notes moved lower, thereby alleviating some of the pressure on non-yielding gold.
Nevertheless, the market still assigns a roughly 94% probability that the Federal Reserve will raise interest rates at today's meeting. These expectations were reinforced by US inflation data released last week that came in hotter than anticipated.
For the month of September, gold prices remain down about 3%, having approached US$4,700 per troy ounce in late August. The market now views the Fed's decision not as the primary surprise, but rather focuses on the future policy direction to be outlined by Fed Chair Kevin Warsh.
Newsmaker Analysis: Gold's current rebound is supported by the correction in yields and oil prices, yet fundamental pressures have not fully dissipated. If the Fed raises rates and leaves the door open for further tightening, XAU/USD risks facing renewed downward pressure. The US$4,250 area serves as a key support level; a break below this could pave the way for a deeper decline. Conversely, if Warsh strikes a more cautious tone, gold could extend its rebound toward the US$4,350–US$4,400 range. (arl)
Source: Newsmaker.id