Gold Price Forecast: XAU/USD remains range-bound above $2,020 in a busy week of policy meetings

Gold Price Forecast: XAU/USD remains range-bound above $2,020 in a busy week of policy meetings

Time Stamp: January 22, 2024 6:09 PM
Source Node: 3078454

Share:

  • Gold price sticks to the range-bound theme near $2,021 ahead of the Bank of Japan (BoJ) meeting.
  • Federal Reserve (Fed) officials indicated that they are in no hurry to cut rates, even if the hikes are probably done.
  • The January US Richmond Fed Manufacturing Index will be due on Tuesday.

Gold price (XAU/USD) clings to the range-bound theme during the early Asian session on Tuesday. Markets turn cautious ahead of a busy week of policy meetings with many central banks, including the Bank of Japan (BoJ). Meanwhile, the US Dollar Index (DXY) moves in a tight range around 103.32. The US Treasury yield consolidates its gains, with the 10-year yield standing at 4.10%. At press time, the gold price is trading at $2,021, up 0.03% for the day.

The Fed Funds Futures market sees no change in rate-setting from the Federal Open Market Committee meeting on January 30-31. However, investors are reducing the outlook for easing to a five-quarter percentage point decrease from six previously. According to the CME FedWatch Tool, the odds for a rate cut at the March meeting fell to 42%, a steep slide from 70% just a week ago.

Furthermore, the Federal Reserve (Fed) officials, including Governor Christopher Waller, John Williams, and Raphael Bostic, indicated that they are in no hurry to cut the rate, even if the hikes are probably done.

The highlight this week will be the US Gross Domestic Product (GDP) for Q4 on Thursday and the Core Personal Consumption Expenditures Price Index (Coe PCE) on Friday. The weaker US data is likely to convince the Fed to tilt toward the dovish side and cap the downside of the gold price. Ahead of the key US event, the US Richmond Fed Manufacturing Index for January will be released later on Tuesday.

Time Stamp:

More from FX Street