"Investors are still digesting the restrictive message from the U.S. Federal Reserve (Fed). Chairman Jerome Powell dismissed the possibility of a rate cut in December, which boosted the U.S. dollar and, in turn, kept pressure on equities that continue to trade in a mixed manner. A stronger dollar tends to make gold more expensive for holders of other currencies and reduces its appeal as an alternative asset."
"On the macroeconomic front, data present a mixed picture: the S&P Global Manufacturing PMI exceeded expectations at 52.5 (above the 50 expansion threshold). At the same time, the Institute for Supply Management (ISM) index fell to 48.7, confirming contractions in parts of the manufacturing sector. This contrast highlights a divergence in the economic drivers that usually support gold as a haven amid global weakness."
Gold trades around $4,000 per ounce with little recent movement due to a lack of clear catalysts. The prolonged U.S. government shutdown has limited the release of economic data and increased market caution. Federal Reserve Chair Jerome Powell dismissed the possibility of a December rate cut, strengthening the U.S. dollar and pressuring equities. A stronger dollar reduces gold's appeal by making it more expensive for holders of other currencies. U.S. macro data are mixed: S&P Global Manufacturing PMI rose to 52.5 while the ISM index fell to 48.7, signaling divergent economic drivers. The ADP employment report remains a near-term focus but is unlikely to trigger a fundamental shift. Deutsche Bank raised its 2026 gold forecast to $4,000 per ounce, citing dollar weakness, official purchases, and a more distant rate-cutting cycle.
Read at London Business News | Londonlovesbusiness.com
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