Gold prices edged higher on Wednesday and are trading just above the $3,300 level. Markets have remained broadly subdued as traders adopt a cautious stance ahead of several key economic data releases. Chief among them are the latest minutes from the Federal Open Market Committee (FOMC), due later today, as well as US GDP figures and the Personal Consumption Expenditures (PCE) inflation data — the Federal Reserve’s preferred inflation gauge — both scheduled for release before the end of the week. Despite the relative calm, the recent US-China trade truce continues to underpin a degree of market optimism, helping offset persistent geopolitical risks and ongoing economic uncertainty — both traditionally supportive of gold. Against this backdrop, investor attention is firmly fixed on the upcoming FOMC minutes. The Federal Reserve’s communication remains critical in shaping market expectations, and any indication of a more hawkish or dovish stance will likely prompt an immediate reaction. As always, changes in interest rate outlook can affect demand for the US dollar and, by extension, influence gold prices due to the typically inverse relationship between the two assets.
Ricardo Evangelista – Director, ActivTrades
Source: ActivTrader
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