Gold Price Forecast: XAUUSD refreshes weekly high, bulls await sustained move beyond $1,900 By HareshMenghani Gold Commodities Fed Bonds XAUUSD
A less hawkish Fed extended support to the metal amid the latest COVID-19 outbreak in China.built on this week's goodish rebound from the $1,850 area, or its lowest level since mid-February and scaled higher for the third successive day on Thursday. The momentum pushed spot prices to a fresh weekly high during the early European session, though bulls struggled to capitalize on the move further beyond the $1,900 round-figure mark.
The Fed on Wednesday announced the largest rate hike since 2000 and the start of quantitative tightening , though downplayed the possibility of super-size hikes. In the post-meeting press conference, Powell eased market fears about a more aggressive tightening path and said that thewas not actively considering a 75 bps rate hike. This, in turn, was seen as a key factor that offered some support to the non-yielding yellow metal.
That said, the markets are still pricing in a further 200 bps rate hike for the rest of 2022, which was evident from a fresh leg up in the US Treasury bond yields. This, in turn, helped revive the demand and acted as a headwind for the dollar-denominated commodity. This makes it prudent to wait for strong follow-through buying before confirming that gold has bottomed out near the $1,850 region and positioning for any further near-term appreciating move., featuring the release of Weekly Initial Jobless Claims later during the early North American session. This, along with the US bond yields, will influence the USD price dynamics and provide some impetus to gold.
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