FED RATE DAY , XAUUSD ANALYSIS SEMS 8-11-24
🚨Fed Expected to Lower Rates, But Inflation Puts Limits on Future Cuts📌
The Federal Reserve is projected to reduce the federal funds rate by 0.25% on Thursday, bringing it to a range of 4.5%-4.75%. However, bond market signals suggest that the pace of future rate cuts may be slower than initially expected.
The yield on two-year Treasuries, a reliable indicator of Fed policy shifts, shows caution. This yield has historically anticipated Fed actions, such as rate hikes in 2021 and the easing measures started last September.
📝Gold Price Outlook Amid Fed Rate Cut📊
If the Fed opts for gradual rate cuts in the coming quarter, it could weaken the US dollar, which tends to boost gold as a non-yielding asset. A weaker dollar makes gold more attractive to investors.
Investors expect gold to rise following the rate cut, as lower rates reduce the opportunity cost of holding gold. However, with the anticipated rate cuts already priced into gold's current price, the short-term impact may be limited.
Expected Price range as per our panel analysis :
🔻Upper Range : $2730-$2760-$2790-$2820-$2850
🔺Lower Range: $2650-$2620-$2590-$2560-$2520
Range Breakout:$2620-2790 will Lead to Further Decline or Further Ascend.
Despite this, analysts are optimistic that gold could reach $3,000 per ounce by year-end.( $2790 All time high on 31-10-24)
📌Gold and Interest Rates 📝💰
Gold generally moves inversely to interest rates—lower rates typically push gold prices higher by making non-yielding assets like gold more appealing.
As the Fed is set to lower rates this week, many investors predict a rise in gold prices. But if these cuts are already priced in, the short-term impact could be minimal.
The Federal Reserve is projected to reduce the federal funds rate by 0.25% on Thursday, bringing it to a range of 4.5%-4.75%. However, bond market signals suggest that the pace of future rate cuts may be slower than initially expected.
The yield on two-year Treasuries, a reliable indicator of Fed policy shifts, shows caution. This yield has historically anticipated Fed actions, such as rate hikes in 2021 and the easing measures started last September.
📝Gold Price Outlook Amid Fed Rate Cut📊
If the Fed opts for gradual rate cuts in the coming quarter, it could weaken the US dollar, which tends to boost gold as a non-yielding asset. A weaker dollar makes gold more attractive to investors.
Investors expect gold to rise following the rate cut, as lower rates reduce the opportunity cost of holding gold. However, with the anticipated rate cuts already priced into gold's current price, the short-term impact may be limited.
Expected Price range as per our panel analysis :
🔻Upper Range : $2730-$2760-$2790-$2820-$2850
🔺Lower Range: $2650-$2620-$2590-$2560-$2520
Range Breakout:$2620-2790 will Lead to Further Decline or Further Ascend.
Despite this, analysts are optimistic that gold could reach $3,000 per ounce by year-end.( $2790 All time high on 31-10-24)
📌Gold and Interest Rates 📝💰
Gold generally moves inversely to interest rates—lower rates typically push gold prices higher by making non-yielding assets like gold more appealing.
As the Fed is set to lower rates this week, many investors predict a rise in gold prices. But if these cuts are already priced in, the short-term impact could be minimal.
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