Gold Prices Struggle to Touch $2,700 Level
Gold (XAU/USD) prices regained some positive traction following the previous day’s profit-taking pullback from a five-week high around $2,726 region, albeit lacked any strong follow-through buying. Persistent geopolitical risks stemming from the Russia-Ukraine war and tensions in the Middle East, along with concerns over US President-elect Donald Trump’s tariff plans, continued to boost the safe-haven demand. Additionally, bets that the Federal Reserve (Fed) will deliver a third straight interest rate cut at the conclusion of its December policy meeting next week acted as a tailwind for the non-yielding yellow metal.
However, the upside in Gold prices remained capped amid expectations that it would adopt a more cautious stance on rate cuts amid signs that progress in bringing inflation down to the 2% target has stalled. The outlook remains supportive of a further uptick in the US Treasury bond yields, which helped the US Dollar (USD) preserve its gains recorded over the past week or so, to fresh monthly tops, and capped Gold prices. Traders may also choose to wait on the sidelines ahead of the crucial two-day FOMC policy meeting starting next Tuesday.
Source: FXStreet