Gold (XAU) declined on Friday, losing initial gains XAUUSD got on the back of the weakening U.S. dollar.
Possible effects for traders
Economic data indicating a slowing U.S. economy brought the U.S. dollar to its lowest point in nearly a month as the chances of additional rate hikes by the Federal Reserve decreased. ‘Data indicating some weakness in labour markets helped drive market expectations around the Fed and thus drove gold higher today. This comes after a retrenchment in some of the risk-off flows that have occurred as concerns about a broader Middle East conflict have ebbed,’ said Christopher Louney, a commodities strategist at RBC Capital Markets.
Today, XAUUSD decreased in the Asian trading session but rose in the early hours of the European session. The People’s Bank of China maintained its one and five-year loan prime rates unchanged at 3.45% and 4.2%, aligning with market forecasts. ‘Spot gold looks neutral in a range of $1,976–1,990 per ounce, and an escape could suggest a direction,’ said Reuters analyst Wang Tao.
