Here is the XAUUSD news update for today, January 11, 2024. Gold prices (XAU/USD) showed a positive increase on Thursday, although they remain below the $2,040-2,042 supply zone. This occurs ahead of the European session and stays close to the three-week low seen on Monday. The reduced odds of an aggressive Fed policy action have limited gold’s upside.
 
Meanwhile, geopolitical tensions from the Israel-Hamas conflict and uncertainty over China’s recovery have limited gold’s appeal as a safe haven. Investors remain cautious ahead of key U.S. data that could provide insights into the Fed's interest rate policy.
 
Daily Market Driver Summary: Gold prices supported by USD weakness amid repositioning before U.S. CPI data.
 
  1. Uncertainty surrounding the Federal Reserve's interest rate policy has kept the U.S. dollar defensive, supporting gold prices amid trade repositioning ahead of U.S. consumer inflation data.
  2. Markets quickly reacted to the Fed’s dovish stance in December, anticipating five rate cuts by the end of 2024, creating around 150 basis points of cumulative easing.
  3. U.S. macro data shows the American economy’s resilience, prompting investors to dial back expectations of more aggressive policy easing.
  4. New York Fed President John Williams stated that the U.S. central bank is in a good position and has time to consider interest rate policy, although it may need to bring rates back to a more neutral level.
  5. The 10-year U.S. bond yield remains above 4.0%, limiting gains for non-yielding gold ahead of today’s key CPI report.
  6. Headline U.S. CPI is expected to rise by 0.2% in December, bringing the annual rate to 3.2%, while the core index is forecasted to drop to 3.8% YoY from 4.0% in the previous month.
  7. Lower-than-expected inflation data would provide a reason for the Fed to cut rates, acting as a negative catalyst for the Greenback, thereby supporting gold prices.
  8. Conversely, stronger U.S. CPI data would give the U.S. central bank room to maintain higher rates for longer, boosting the dollar and driving gold prices below Monday’s multi-week low.
Warning!
 
This is an explanation of “XAUUSD Today: January 11, 2024 - Limited Rise Held Back by U.S. CPI”. This analysis is based on fundamental and technical perspectives from trusted sources and does not serve as financial advice or solicitation. Always remember that this content aims to enrich the reader’s knowledge. Always conduct independent research on other forex information as a reference for your trading.
 
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