- Continuing the movement at the end of last week’s trading, the XAU/USD gold price is moving within a rebound upwards, with gains that affected the $1934 resistance level.
- At the beginning of this week’s trading, it settled in the path of this rebound in a range between $1913 an ounce and $1928 an ounce.
- The gold market is trying to benefit positively from the decline in the US dollar, following the announcement of US job numbers at the end of last week.
At the beginning of this week's trading, gold prices declined slightly, with the dollar recovering from some of its sharp losses on Friday, after disappointing inflation data from China. Meanwhile, the Chinese yuan fell, and the dollar rose against most major rivals after official data showed that consumer prices in China remained unchanged in June from a year ago, after rising 0.2 percent in May. On a monthly basis, consumer prices fell 0.2 percent, while expectations were unchanged. Chinese producer prices fell 5.4 percent year-on-year, sharper than the 4.6 percent drop in May and economists' expectations for a 5.0 percent drop. This was the largest decline since December 2015.
With concerns about China's economic recovery mounting, investors are now betting that policymakers will unveil more stimulus for the economy.
The US economic calendar remains light, with reports on wholesale inventories for May and consumer inflation expectations for June due for release in the New York session. In addition, a group of Fed officials, including San Francisco Fed President Mary Daley, Cleveland Fed President Loretta Mester, and Atlanta Fed President Raphael Bostick, will deliver speeches ahead of key US inflation data due later. In the week.
All in all, the big question hanging on Wall Street is whether the US economy can avoid a long-anticipated recession despite interest rate hikes aimed at lowering inflation. The hope is that inflation will ease enough for the Fed to soon halt its rate hikes, which have already caused cracks in the banking industry and other corners of the economy.
Wednesday's report will provide the latest monthly update on US inflation at the consumer level, and economists expect it to show another slowdown. They expect consumer prices to be 3.1% higher in June than a year earlier, down from the 4% inflation rate in May.
The US Federal Reserve has acknowledged that inflation has slowed since last summer, when it peaked just above 9%, but has also hinted that it may raise interest rates one or two more times this year before keeping them at a high level to ensure inflation returns to the 2% target. %. Such talk has helped erase many previous bets among traders that the Fed might not only halt its interest rate hikes this year but cut them. That sent Treasury yields back to their highest levels since March, before high rates helped cause the collapse of several US banks that shook confidence in the system.
XAU/USD gold price forecast today:
The XAU/USD gold price may remain in a positive situation until the markets and investors react to the announcement of US inflation numbers this week. That will have a strong and direct reaction on the future of raising US interest rates, and therefore on the price of the dollar, and the price of gold will automatically be affected. In the event that the numbers come in less than expected, the weakness of the dollar may continue, which may allow the gold price to rebound higher, and the closest resistance levels to the current rebound will be 1948 and 1970 dollars an ounce. The last level is important for the bulls to start controlling the trend, and with it the talk of returning to the psychological resistance of 2000 dollars increases.
On the other hand, if the US inflation figures are higher and support the course of tightening the US Federal Reserve's policy, gold's recent gains may evaporate, and it is not excluded that a break below the $1900 support level will return.
Ready to trade our Gold price forecast? We’ve made a list of the best Gold brokers worth trading with.
