Gold retakes $4,000 as fresh USD selling counters hawkish Fed and trade optimism
Gold (XAU/USD) adds to its intraday gains and jumps back above the $4,000 psychological mark during the first half of the European session on Thursday.
Concerns about economic risks stemming from a prolonged US government shutdown drag the US Dollar (USD) away from an over two-week high, touched the previous day, and help revive demand for the safe-haven precious metal. However, a combination of factors might hold back traders from placing aggressive bullish bets around the commodity.
Federal Reserve (Fed) Chair Jerome Powell pushed back against market expectations for another interest rate cut in December, which, in turn, could limit deeper USD losses. Apart from this, the latest optimism over a positive outcome from a high-stakes meeting between US President Donald Trump and Chinese leader Xi Jinping contributes to capping the safe-haven Gold.
This makes it prudent to wait for some follow-through buying before confirming that the corrective slide from the all-time peak has run its course.
Source: FXstreet