Gold Prices Remain Weak, US Dollar Strengthens Ahead of Economic Data
Gold prices weakened again on Friday morning, dragged down by the strengthening US Dollar (USD), which attracted buying interest in the foreign exchange market. The precious metal had strengthened overnight, but then returned to negative territory in the Asian session, remaining in the mid-$3,300s per ounce range. The strengthening of the USD from multi-week lows was one of the main factors weighing on gold prices.
Market optimism regarding the US-Japan trade deal also reduced demand for safe-haven assets like gold. Negative sentiment toward gold has now entered its third consecutive day. Nevertheless, gold remains near its weekly low, reflecting market caution regarding the short-term outlook.
On the other hand, uncertainty about the direction of the Federal Reserve's (Fed) interest rate policy is a factor restraining further pressure on gold prices. Political pressure on the Fed to lower interest rates has also raised concerns about the central bank's independence, which could trigger renewed buying interest in safe-haven assets.
Furthermore, geopolitical tensions in Southeast Asia—particularly the escalating border dispute between Thailand and Cambodia—have the potential to provide short-term support to gold prices. Investors are now awaiting today's release of US Durable Goods Orders data, which could trigger renewed volatility in the dollar and precious metals ahead of the weekend.
Source: Newsmaker.id
