Gold Edgy As Investors Await Federal Reserve`s Decision

Published on Jul 25, 2023 13:42

Gold was seen trading with minute gains in the Asia electronic trades today after finishing the session lower nearly $5 as dollar above 101 mark following stronger manufacturing data from US.

The dollar index jumped past 101 mark against the basket of 6 major currencies, and is up nearly 2% since hitting 15-month low of 99.22. Recovery in greenback came ahead of Fed’s rate decision tomorrow, and it is widely expected to hike the rates by 25 basis point to 5.50.

MCX bullion futures for August 4 delivery were recently seen trading at Rs 59131, up Rs 55 per 10 grams. The contract has been unable to breach the critical Rs 60000 mark in the month so far and has traded in range of Rs 2013 ie. Rs 59984- 57971.

Apart from the rate decision, market participants will also pay close attention to the comments made by Fed Chair Jerome Powell following the meeting, hoping to gain insights into the central bank`s future actions. Additionally, the European Central Bank is likely to increase rates by another quarter-point on Thursday, while the Bank of Japan is expected to maintain its current policy of ultra-low interest rates on Friday. The financial markets are also anticipating the release of the Fed-preferred PCE inflation gauge and the advance estimate of US Q2 GDP growth later this week.