Gold Strengthens Amid Tariff and Fed Policy Uncertainty
Gold prices (XAU/USD) strengthened slightly, approaching $3,350 during the Asian trading session on Monday (July 21). This increase was driven by the ongoing uncertainty surrounding trade negotiations, particularly as the approaching tariff deadline with the US approaches. Traders will also be closely monitoring Federal Reserve Chairman Jerome Powell's speech on Tuesday, which could provide further clues regarding US monetary policy.
US Secretary of Commerce Howard Lutnick stated that August 1 is the definitive deadline for countries to begin paying tariffs to the US. Although the tariff schedule has shifted several times, the White House's firmness regarding the date increases uncertainty, which could boost gold demand. Gold is often considered a safe-haven asset during times of uncertainty like these, as investors tend to seek a hedge.
Furthermore, dovish statements from Fed officials could also influence gold price movements. Fed Governor Christopher Waller stated that the US central bank needs to cut interest rates to address rising risks to the economy. While interest rates are likely to remain unchanged at the end of this month, this could support gold prices. However, increased demand for the US dollar also has the potential to depress USD-denominated gold prices in the near term.
Source: (ayu-newsmaker)
