GOLD
Gold prices remain relatively unchanged as Friday’s session commences in Europe, having recouped losses incurred during early Asian trading. The upward trajectory of gold prices over the past two months can be attributed to heightened geopolitical instability and anticipations of Federal Reserve rate cuts in the first half of the year. In light of these factors, today’s release of US employment data holds significant weight, potentially either affirming the recent hawkish Fed stance, advocating for sustained higher rates, or potentially altering that trajectory, reigniting expectations of an initial rate cut in June. This interplay will reverberate through the performance of the US dollar and consequently affect gold as well, given their inversely correlated relationship. A robust employment report validating the strength of the American economy is likely to temper the upward momentum of gold prices. Conversely, a lacklustre employment figure, indicating a shortfall in new job creation, could weaken the greenback and provide a buoyant backdrop for the price of bullion.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
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