Here is the update for XAUUSD news today, November 16, 2023. Gold prices (XAU/USD) attracted buying interest around the $1,973 level at the start of this week, although there was no follow-through and remained below the two-week peak reached on Friday before the European session. The risk-on sentiment in Asian equity markets is considered a key factor hampering the precious metal as a safe haven. Nevertheless, the corrective decline seems limited due to the dovish expectations surrounding the Federal Reserve (Fed).

Confidence is growing that the U.S. central bank will maintain its current policy at the December 2023 meeting and may cut interest rates in 2024, putting pressure on the U.S. Dollar (USD) to its lowest position since August 31. Meanwhile, worsening global economic prospects and geopolitical risks also support gold prices as a safe haven, providing support for moderate intraday gains.

However, buyers appear reluctant to take aggressive positions, preferring to wait until the FOMC meeting minutes are released on Tuesday. Investors will pay close attention to the minutes for new insights into interest rate policy and the views of policymakers regarding whether the U.S. Central Bank will raise rates again this year. This is likely to drive demand for the USD in the near term, providing a significant boost to gold prices, which do not offer yield.

Summary of Daily Market Movers: Gold prices struggle to capitalize on moderate intraday gains amid a risk-on situation.

Gold prices remain supported by hopes that the Federal Reserve (Fed) will not raise interest rates, with signs that fears of high prices have subsided. Last week's U.S. CPI report showed consumer inflation slowing faster than expected, and U.S. Jobless Claims on Thursday indicated a weakening labor market. The market believes that the Fed will hold interest rates at the December 2023 meeting and anticipates rate cuts of about 100 basis points by the end of 2024. Changes in expectations regarding Fed policy have driven U.S. 10-year government bond yields to their lowest level in two months on Friday, benefiting non-yielding metals. The U.S. Dollar weakened, approaching its lowest level since September, providing additional support to XAU/USD ahead of the FOMC minutes on Tuesday.

Escalating violence between Israel and Hamas raises concerns about its impact on the global economy, potentially pushing the country into recession. Israel and the U.S. have rejected reports of possible progress in negotiations with Hamas to release around 240 hostages in Gaza in exchange for a five-day ceasefire. The People's Bank of China keeps the Loan Prime Rate (LPR) close to a record low while injecting around 80 billion Yuan in liquidity into the market. Chinese regulators are committed to providing more policy support to the struggling real estate sector, boosting investor confidence and limiting safe-haven demand for XAU/USD.


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