Gold is likely to hit a new all-time high within weeks, driven by factors such as anticipated interest rate cuts by the US Federal Reserve, continuous gold purchases by the People’s Bank of China, and growing demand from regions like Turkey and the Middle East.
The Pound Sterling gained 0.04% against the US Dollar, trading at 1.2703. The GBPUSD pair cleared resistance levels and momentum favors buyers, but downside risks remain. To continue bullish, GBPUSD must stay above 1.2700, with resistance at 1.2803 and 1.2893. If the price falls below 1.2700, it could retest support levels at 1.2634, 1.2594, and 1.2584.
The US Dollar is under modest selling pressure as investors await key data releases, including the first estimate of annualized GDP growth for the first quarter and weekly Initial Jobless Claims data.
Gold hit a new all-time high above ,350 at the weekly opening after gaining over 4% in the previous week, reaching a record high of ,330 on Friday.
The EURUSD pair maintained its position around 1.0770 on Friday, facing downward pressure due to the European Central Bank officials suggesting a probable interest rate cut in June. Weaker-than-expected retail sales data from Germany also contributed to the Euro’s decline. Meanwhile, the US Dollar Index (DXY) strengthened, nearing 104.60, driven by annualised economic expansion in the United States and hawkish statements from a Federal Reserve official.
The European Central Bank (ECB) is considering cutting interest rates in June, causing weakness for the Euro and depressing the EURUSD pair. ECB officials have expressed dovish views on rate cuts, while the Federal Reserve in the US seems more split on the issue. Bargain hunters may see dips in the EURUSD pair as a buying opportunity, and economists at ING expect the pair to stabilize around 1.0850.
The Japanese Yen weakened against the US Dollar, reaching its highest level since 1990 near 152.00. Finance Minister Shunichi Suzuki stated that they won’t rule out any steps, including decisive ones, to respond to disorderly moves in the foreign exchange market. BoJ board member Naoki Tamura mentioned the possibility of hiking rates again if certain conditions are met.
– The EUR/USD pair increased after US Nonfarm payrolls data showed a decrease in Average Hourly Earnings and an increase in the Unemployment Rate.
– The US economy added 275,000 jobs in February, more than the 200,000 expected.
– Average Hourly Earnings rose by 4.3% YoY and 0.1% MoM, both below the predicted 4.4% and 0.3%.
– The Unemployment Rate increased to 3.9%, higher than the expected 3.7%.
– This data could lead the Federal Reserve to cut interest rates earlier than anticipated.
– Francois Villeroy de Galua, Governor of the Bank of France and ECB Governing Council member, stated a rate cut in spring is “very likely.”
– Joachim Nagel, Bundesbank President, mentioned the increasing probability of an interest-rate cut before the summer break.
– ECB President Christine Lagarde indicated June as the next key date for reviewing policy on interest rates.
– The EUR/USD is in a short-term uptrend due to the anticipation that the US Fed might lower interest rates sooner than the ECB.
– Technical analysis suggests a tentative short-term uptrend for EUR/USD, with recent signs indicating a possible correction.