Gold weakens amid rising USD
Gold weakens amid rising USD
Written by: PaxForex analytics dept - Wednesday, 26 June 2019 0 comments
The price of gold falls on Wednesday morning against the backdrop of the rise in the US currency to its main competitors after the statements by the head of the Federal Reserve System (FRS) regarding the country's economy and further monetary policy of the department.
As of Wednesday morning, the price of August gold futures on the New York stock exchange Comex fell by $ 7.65, or by 0.53%, to $ 1,411.05 per troy ounce. The cost of the July silver futures fell by 0.62%, to 15,205 USD per ounce.
The current direction of the dollar adds pressure on the prices of precious metals. It is increasing in relation to most of the world's leading monetary units. Thus, the USD index (the exchange rate of the American currency to the basket of monetary units of 6 states - the leading US trading partners) rose by 0.19% to 96.32 points.
Forex platform >
The dynamics of the USD is related to the statements of Jerome Powell, the Fed leader, which led to a weakening of expectations of a 50 percent base point decline in the US base rate in June, which in fact would be negative for the dollar. At the same time, investors are still hoping that the rate will be lowered by 25 basis points from the current mark of 2.25-2.5%.
In addition, investors attribute the decline in the value of gold to a correction after four consecutive trading sessions. During this time, the price of precious metals rose by almost 5% against the background of a sharp increase in demand for it as a safe asset. The fact of an impressive rise in prices for this precious metal contributes to the expectation of some short-term profit-taking.
As of morning, the single European currency exchange rate against the dollar fell to 1.1355 dollars per EUR from the level of yesterday's close of 1.1365 USD per euro. The exchange rate of the American currency to the Japanese yen rose to the level of 107.47 yen from 107.17 JPY per dollar in trading the day before.
Fx trading >
Meanwhile, North American stocks fell sharply the day before, as concerns about trading and disappointing financial data forced traders to take a wait-and-see attitude, while Fed Chairman Powell emphasized the regulator’s independence from the US President Donald Trump, who is calling for lower interest rates.
All 3 key stock indexes closed a volatile session in negative territory after the comments of the Fed that the regulator is trying to understand whether trade uncertainty and other problematic issues justify lowering rates.
Earlier, the head of the Federal Reserve Bank of St. Louis, James Bullard told the agency Bloomberg that, according to him, the Fed does not need to reduce rates by half a percentage point at the end of the next month.
Metatrader 4 brokers - why PaxForex?
Forex trading recommendations:
EURUSD: Sell. Entry point – 1, 1359. Take Profit – 1, 1339. Stop Loss – 1, 1394.
AUDUSD: Sell. Entry point – 0, 6965. Take Profit – 0, 6950. Stop Loss – 0, 6991.
USDCAD: Buy. Entry point – 1, 3180. Take Profit – 1, 3196. Stop Loss – 1, 3152.
As of Wednesday morning, the price of August gold futures on the New York stock exchange Comex fell by $ 7.65, or by 0.53%, to $ 1,411.05 per troy ounce. The cost of the July silver futures fell by 0.62%, to 15,205 USD per ounce.
The current direction of the dollar adds pressure on the prices of precious metals. It is increasing in relation to most of the world's leading monetary units. Thus, the USD index (the exchange rate of the American currency to the basket of monetary units of 6 states - the leading US trading partners) rose by 0.19% to 96.32 points.
Forex platform >
The dynamics of the USD is related to the statements of Jerome Powell, the Fed leader, which led to a weakening of expectations of a 50 percent base point decline in the US base rate in June, which in fact would be negative for the dollar. At the same time, investors are still hoping that the rate will be lowered by 25 basis points from the current mark of 2.25-2.5%.
In addition, investors attribute the decline in the value of gold to a correction after four consecutive trading sessions. During this time, the price of precious metals rose by almost 5% against the background of a sharp increase in demand for it as a safe asset. The fact of an impressive rise in prices for this precious metal contributes to the expectation of some short-term profit-taking.
As of morning, the single European currency exchange rate against the dollar fell to 1.1355 dollars per EUR from the level of yesterday's close of 1.1365 USD per euro. The exchange rate of the American currency to the Japanese yen rose to the level of 107.47 yen from 107.17 JPY per dollar in trading the day before.
Fx trading >
Meanwhile, North American stocks fell sharply the day before, as concerns about trading and disappointing financial data forced traders to take a wait-and-see attitude, while Fed Chairman Powell emphasized the regulator’s independence from the US President Donald Trump, who is calling for lower interest rates.
All 3 key stock indexes closed a volatile session in negative territory after the comments of the Fed that the regulator is trying to understand whether trade uncertainty and other problematic issues justify lowering rates.
Earlier, the head of the Federal Reserve Bank of St. Louis, James Bullard told the agency Bloomberg that, according to him, the Fed does not need to reduce rates by half a percentage point at the end of the next month.
Metatrader 4 brokers - why PaxForex?
Forex trading recommendations:
EURUSD: Sell. Entry point – 1, 1359. Take Profit – 1, 1339. Stop Loss – 1, 1394.
AUDUSD: Sell. Entry point – 0, 6965. Take Profit – 0, 6950. Stop Loss – 0, 6991.
USDCAD: Buy. Entry point – 1, 3180. Take Profit – 1, 3196. Stop Loss – 1, 3152.