Logo of Phnom Penh Post newspaper Phnom Penh Post - Gold in downturn with inflation and Covid optimism

Gold in downturn with inflation and Covid optimism

Content image - Phnom Penh Post
Chhea Chhayheng, business manager at PPLS.

Gold in downturn with inflation and Covid optimism

As Asian traders started a crucial week that included the US Federal Reserve’s monetary policy meeting on Tuesday and Wednesday, the price of gold (XAU/USD) was holding stable at around $1,675.

After data revealed demand for employees in the US remained strong, gold prices fell amid expectations of further aggressive interest rate raises by the Fed, Kitco News reported.

Retail sales were also reasonable, meaning the Fed would likely continue its cycle of tightening for some time, it added.

FX Street reported: “Gold prices are expected to remain volatile ahead of the interest rate decision by the Federal Reserve. Per the consensus, the Fed is expected to announce a third consecutive 75 basis points (bps) interest rate hike. However, doors are open for a higher rate as price pressures are needed to contain sooner.

“Meanwhile, the US dollar index (DXY) oscillates around the critical support of 109.50 as market veterans have slashed the US growth rates. Economists at Goldman Sachs have trimmed the growth forecasts for 2023.

“US Gross Domestic Product (GDP) is expected to increase by 1.1 per cent as Fed’s tightening path along with the current restrictive policy will prove less room for growth in the scale of economic activities.”

Meanwhile, US President Joe Biden said in a CBS 60 Minutes interview that “I’m more hopeful than I have been in a long time” regarding the state of the US economy and the Covid pandemic.

“I’m telling the American people that we’re gonna get control of inflation,” Bloomberg reported President Biden as saying in the interview.

FX Street reported cause for optimism for the global economy.

“On the same line are the Covid updates from China as it unlocks Dalian and Chengdu cities while witnessing zero coronavirus cases in Beijing and one, versus zero the previous day, outside Shanghai’s quarantine zone.”

Investors should note that the gold price is hovering below $1,700 based on one-day chart view and has already passed $1,680.

Therefore, with gold in a downtrend in the technical charts, playing between $1,680 to $1,650, investors should set a stop-loss function to protect their capital.

MOST VIEWED

  • Bareknuckle champion wants Kun Khmer fighter

    Dave Leduc, who is the current openweight Lethwei boxing champion in Myanmar, has announced that he will travel to Cambodia this year to challenge SEA Games gold medallist Prum Samnang any time that is convenient, after their planned match later this month in Slovakia was

  • Five-year-old Hanuman dances his way into hearts of Cambodia

    A young talent from a new-established settlement has emerged, captivating the online world with his mesmerising performances of the traditional Cambodian monkey dance. Roeun Kakada is a five-year-old prodigy who has taken the social media sphere by storm with his exceptional dance skills and dedication

  • Fresh Covid warnings as Thai hospital fills

    A senior health official reminds the public to remain vigilant, as neighbouring countries experience an increase in Covid-19 cases, with the latest surge appearing to be a result of the Omicron XBB.1.5 sub-variant. Or Vandine, secretary of state and spokeswoman for the Ministry of Health,

  • Honda shutters Siem Reap football club

    Japanese football legend Keisuke Honda, the owner of Siem Reap football club Soltilo Angkor FC, has been forced to shut the club down, after it failed to attract sponsorship for the upcoming season. Honda, the former manager of the Cambodia men's national football team, said

  • PM declares ASEAN Para Games open

    The 12th ASEAN Para Games officially kicked off on the evening of June 3 at Morodok Techo National Stadium in Phnom Penh, with a spectacular opening ceremony featuring fireworks and performances by some of the Kingdom’s most accomplished talents. Tens of thousands of sports fans

  • Hun Sen warns of regional tensions

    ASIA is becoming a dangerous geopolitical hotspot, with several countries announcing that they intend to send naval vessels towards Southeast Asia and on to the South China Sea, warned Prime Minister Hun Sen. “Heated geopolitical issues can easily escalate, namely to war. I am not