Title: Gold Price Forecast: XAU/USD struggles near one-month low, around $1,770 region
Dec 02, 2021 4:48AM ET
Gold costs went under recharged selling tension on Thursday, tumbling to a close to one-month low close $1,768 toward the beginning of European exchanging. The growing conviction that the US Federal Reserve will tighten monetary policy sooner rather than later to combat persistently high inflation drove the exodus from the low-yielding yellow metal. Bets increased further after Fed Chairman Jerome Powell said the central bank must be prepared to respond to the possibility that inflation may not decline in the second half of 2022.
In his testimony before Congress, Fed Chairman Jerome Powell said the US central bank would consider reducing its bond purchases more quickly at the upcoming two-day meeting that begins on December 14. Powell's tougher stance acted as a tailwind for the US dollar, which was seen as another factor weighing on dollar-denominated gold. Aside from this, a strong assembly in US value prospects additionally debilitated the place of refuge XAU/USD. This largely offset concerns about the economic impact of the spread of the Omicron variant of the coronavirus, which provided little support for the commodity.
Market concerns were elevated after US authorities reported that a new, more contagious, and perhaps antibody safe microbe had been found in the country. However, market sentiment was bolstered by overnight comments from the World Health Organisation (WHO) representative that some of the early indications were that most Omicron cases were mild.