Spot gold inched up 0.1% to $2,030.01 per ounce, and U.S. gold futures added 0.28% to $2,031.30
Gold eked out gains on Wednesday due to a lower dollar, as investors awaited a deluge of economic news in the U.S. this week for more clues on the pace and scale of the Fed’s interest rate cuts.
Spot gold inched up 0.1% to $2,030.01 per ounce by 10:26 GMT. U.S. gold futures added 0.28% to $2,031.30.
The dollar slid 0.5% against its rivals, after reaching its highest since December 13 on Tuesday, while the Benchmark 10-year Treasury yield also edged down but stayed above 4%.
I think gold holding above that kind of psychological threshold of $2,000 is a sign of traders’ ongoing belief that rate cuts are coming soon and they will be quite aggressive when they do start, said Craig Erlam, senior markets analyst at OANDA.
Investors are now focusing on the U.S. flash PMI survey, which is scheduled at 1445 GMT, fourth-quarter advance Gross Domestic Product (GDP) estimates on Thursday, and personal consumption expenditure (PCE) data on Friday.
I think if the PCE data on Friday is higher I would not be surprised if gold surpasses $2,000 range and if the data is in line or lower, then gold could hold above $2,000 for a little bit longer, Erlam said.
A strong U.S. economy and pushback from Fed officials is leading some investors to rethink their bets on how quickly the Federal Reserve will cut rates in 2024.
As per the CME’s FedWatch Tool, markets expect the US central bank will keep interest rates unchanged at the end of its policy meeting on January 30-31 and have pushed back the timeframe of the first interest rate cut.