Gold hovers near key levels as investors await Fed Chair Powell’s testimony

Gold prices are hovering near their highest levels in three months on Tuesday as investors await testimony from Federal Reserve Chair Jerome Powell and key jobs data later this week.

The rise in gold prices was driven by weaker-than-expected US data and falling real interest rates… but there was a general buy-on-dips mentality and positive investor sentiment towards gold supporting the upside bias.”

Data last week showed a further decline in the US manufacturing sector in February, alongside a gradual easing of inflation, while consumer sentiment remained weak.

Meanwhile, Federal Reserve Bank of Atlanta President Raphael Bostic said on Monday that the bank is not under pressure to cut interest rates in a hurry, highlighting the “booming” economy and labor market.

Market focus now turns to Fed Chair Powell’s two-day congressional testimony on Wednesday and Thursday, in a week packed with jobs data, as investors look for further clues on the health of the US economy and the timing of potential rate cuts by the central bank.

Gold and the dollar now

Gold futures are now down 0.08% to $2124 an ounce. While spot gold is up about 0.1% to $2116 an ounce. It is hovering around Monday’s high of $2119.69, its highest since December 4.On the other hand, the US dollar index is up 0.1% to 103.877.

Other metals

Spot platinum fell 0.7% to $890.95 an ounce, and palladium fell more than 1% to $950.13. While spot silver fell 0.8% to $23.71.

Bitcoin’s market cap reaches historic level and the rally continues

Digital currencies, led by the largest market cap cryptocurrency, Bitcoin, have continued their record-breaking upward trend of the past few days, with the popular cryptocurrency touching its highest level ever, while the token has already reached a record level in terms of market cap.

Bitcoin’s market cap reached $1.33 trillion, surpassing the $1.28 trillion peak it hit in November 2021, according to Investing Saudi Arabia data. That was the month the token jumped to $68,991.85 at the height of its pandemic-era bull run.

With this year’s rapid rise, Bitcoin has become one of the world’s largest assets, now approaching silver’s market cap of $1.4 trillion. The supply of Bitcoin has since grown, pushing its value to a new level amid the recent record high for the oldest cryptocurrency.

Bitcoin is now up about 6% in the past 24 hours, trading at $67,370. This comes after it hit $68,804 in the past few hours. Meanwhile, Ethereum, the second-largest cryptocurrency by market cap, is up about 7.3% in the past 24 hours, to $3,712.

Demand for new Bitcoin spot exchange-traded funds (ETFs) listed in the United States, coupled with the impending slowdown in currency supply growth with Bitcoin’s halving in April, have added to recent gains.

Oil continues to decline after tepid reception to China’s pledge to transform its economy

Oil prices fell for a second day on Tuesday as investors gave a lukewarm reception to pledges by China, the world’s largest crude importer, to transform its economy amid stuttering growth since the Covid pandemic, with traders worried about slowing consumption.

China pledged to “transform” its economic development model and reduce excess industrial capacity and set a 2024 economic growth target of around 5%, in line with last year’s target and in line with analysts’ expectations. China also pledged to boost oil and gas exploration and development, but at the same time pledged to tighten controls on fossil fuel consumption.

While concerns about China’s demand outlook have weighed on prices, supply factors driven by output cuts by major producers and geopolitical concerns about the war between Israel and the Palestinians in the Gaza Strip have supported crude prices.

The OPEC+ alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, on Sunday extended its voluntary oil production cuts by 2.2 million barrels per day into the second quarter to support prices amid global growth concerns and rising output outside the group.

US crude oil stockpiles are expected to have risen last week, according to a preliminary Reuters poll on Monday, while distillate and gasoline stocks are expected to have fallen. Four analysts polled by Reuters estimated that crude stocks rose by an average of 2.6 million barrels in the week ended March 1.

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Disclaimer: This article is not investment advice or an investment recommendation and should not be considered as such. The information above is not an invitation to trade and it does not guarantee or predict future performance. The investor is solely responsible for the risk of their decisions. The analysis and commentary presented do not include any consideration of your personal investment objectives, financial circumstances, or needs.

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