Gold Rises, But Markets Aren't Convinced!
Gold prices (XAU/USD) sparked continued buying for the second consecutive day on Thursday (July 10th), continuing to recover from a one-and-a-half-week low of $3,283-$3,282 reached the previous day. Concerns about the potential economic impact of US President Donald Trump's trade tariffs have helped revive demand for traditional safe-haven assets. Furthermore, strong demand at Wednesday's 10-year government bond auction and the prospect of a Federal Reserve (Fed) interest rate cut this year led to a further decline in US Treasury bond yields. This, in turn, pulled the US Dollar (USD) away from its two-week high reached on Tuesday and proved to be a key factor supporting the commodity.
Meanwhile, traders reduced their bets on the number of Fed rate cuts this year following the release of upbeat US employment data last Thursday, which showed the economy added more jobs than expected in June. Furthermore, the June FOMC meeting minutes released on Wednesday revealed that only a few officials felt interest rates could be cut as soon as this month amid concerns about inflationary pressures from tariffs. This could be a boost for the USD and discourage traders from placing aggressive bullish bets on non-yielding gold. Therefore, it would be prudent to wait for further strength beyond the $3,345-3,346 area, or the weekly high, before confirming a short-term bottom for the XAU/USD pair.
Source: (ayu-newsmaker)
