Gold’s Winning Streak Keeps Rolling
Gold (XAU/USD) sashayed past the $2,440 mark on Tuesday, giving its fifth straight day of gains a polite nod to the rest of the market. But the shiny metal still hasn’t hit the high that was set on May 20, thanks to a bit of U.S. dollar buying that keeps the safe‑haven’s upside in check.
Why the Bullish Mood Persists
- Fed’s Sweet Spot: The chatter around the Federal Reserve suggests it might start trimming rates in September.
- Powell’s Voices: The Fed Chair’s recent remarks have silenced the Treasury yields and kept gold feeling the positive vibes.
- Retail Sales on the Horizon: Markets are waiting for the U.S. retail sales numbers – fresh data could guide the next move.
Powell’s Take on Inflation
On Monday, Powell highlighted that inflation’s steady climb back to the 2% target gives investors a breath of fresh air. A recent drop in the core consumer price index—its first decrease in over four years—meant the yearly rate slowed to 3% from 3.3% in May.
“We’re not waiting for inflation to hit 2% before easing,” Powell said, hinting that rate cuts may not be far off. This view backs gold in the short term, with the market leaning towards a September drag on borrowing costs and perhaps another cut by year‑end.
Dollar’s Roller‑Coaster
Despite gold’s shine, the dollar has gained a sliver of momentum, pulling away from its 3‑month low. That movement could temper gold’s gains a bit in the medium term. Meanwhile, global stocks are riding the risk‑on wave, which means gold might stay steady until the retail sales drop.
- Core retail sales for May are expected to stay flat.
- Sales excluding auto could tick up by 0.1% for the month.
- The Dollar Index hovered around 104.50.
- 10‑Year Treasury yields linger near 4.2%.
- U.S. stock futures enjoyed a modest lift.
Gold’s Gentle Rumble
In a delightful twist, gold regained its footing after dipping near the $2,400 threshold, closing a tad higher on Monday. Its upward push is steering toward the $2,450 rung. Powell’s dovish remarkazz, paired with the inflation optimism, has buyers buzzing about potential rate cuts that could further lift gold.
With upcoming data on the deck, gold’s ride could go either high or correct downward, so traders should keep a keen eye.
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