Gold Consolidates, Oil Prices Cut Rate Cut Hopes
Gold prices (XAU/USD) moved flat around the psychological level of US$5,000 at the start of Wednesday's Asian session, as market participants opted to hold positions ahead of the Federal Reserve's interest rate decision. The Fed is expected to keep interest rates in the 3.50%–3.75% range, so market attention will be focused on Fed Chairman Jerome Powell's statement and press conference following the decision.
On the geopolitical front, the Iran war shows no signs of abating. Israel claimed to have assassinated Iran's security chief, Ali Larijani, while Tehran reportedly set fire to a large gas field in the United Arab Emirates overnight. US President Donald Trump also threatened to expand attacks on Kharg Island, Iran's main export hub. The escalation involving Iran and the UAE has the potential to increase demand for safe-haven assets like gold.
However, this safe-haven support faces a restraining factor on the interest rate side. The surge in oil prices has added to inflation concerns, leading the market to reduce expectations of an imminent interest rate cut. Goldman Sachs reportedly pushed back its forecast for a rate cut to September and December from June and September. In this context, non-yielding gold tends to be held back when the likelihood of a rate cut diminishes.
Gold Price at the Time of Release of This Analysis Was at $4,491
- Buy if the price moves to $4,990
- Sell if the price moves to $5,000
Resistance 2: $5,025
Resistance 1: $5,010
Support 1: $4,987
Support 2: $4,975
Note: This article is analytical in nature and is not a definitive reference. Please consider the impact of fundamental and technical developments on trading before making any investment decisions.
Source: Newsmaker.id
