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XAUUSD holds above $1900 despite hawkish Fed

XAUUSD holds above $1900 despite hawkish Fed

Gold prices has slipped lower amid the strengthening greenback in the aftermath of the Fed’s hawkish remarks.

The bullion bulls have been forced to temper their enthusiasm as one more potential Fed rate hike is pencilled in before the end-2023.

At the moment the market expects a 26.4% chance of a rate hike in November & 45.1% chance in December.

On the positive side, the gold might still be an attractive asset for those trying to hedge themselves against the market uncertainty.

At the time of writing, SPDR Gold Trust (world's largest gold ETF) has gained ~$300 million in value since Monday

In the short-term:

  • XAUUSD’s upside potential may be capped below $1950 due to a possibility of another Fed’s rate hike until the end of 2023

In the long-term:

  • XAUUSD might gain a strong positive momentum, moving back above the $1950 round number, if the inflationary risks are tempered and major central banks reassure investors in it’s trajectory to start lowering interest rates...

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