Here’s the update on XAUUSD today, January 9, 2024. Gold prices (XAU/USD) recovered from a three-week low around $2,017-$2,016 on Tuesday. A decrease in U.S. consumer inflation expectations has raised speculation that the Federal Reserve (Fed) may cut interest rates in early March, providing support for non-yielding gold.

However, the intraday rise is not entirely assured due to optimistic U.S. employment details and hawkish statements from several Fed officials, creating uncertainty regarding an earlier rate cut. U.S. 10-year government bond yields above 4.0% support the U.S. dollar (USD) and limit gold price gains.

Daily Market Movement Summary: Gold prices rose amid uncertainty surrounding Federal Reserve (Fed) interest rate policies.

  1. The Federal Reserve Bank of New York reported on Monday that short-term U.S. consumer inflation projections fell to their lowest level in nearly three years in December, weakening the U.S. dollar and benefiting gold prices.
  2. One-year inflation is projected at 3%, the lowest since January 2021, while three-year inflation is estimated at 2.6%, and five-year price pressures at 2.5%, down from 2.7% in November.
  3. This data reinforces expectations for a potential policy shift by the Fed in the near term, although investors have reduced expectations for more aggressive easing as the U.S. economy remains strong.
  4. Atlanta Fed President Raphael Bostic noted the decline in inflation was greater than expected and emphasized the need for the central bank to allow more time for strict policies to curb inflation.Bostic projected two rate cuts of 25 basis points by the end of 2024.
  5. Fed Governor Michelle Bowman stated that current policy appears adequate and that inflation could decrease further if rates remain stable, although inflationary risks still exist.
  6. This increases uncertainty regarding the likelihood of an earlier Fed rate cut, keeping U.S. 10-year government bond yields above 4.0% and potentially limiting the rise of non-yielding gold.
  7. Market focus remains on U.S. consumer inflation figures on Thursday, which will influence the next direction of XAU/USD.
FAQ About the Fed
Q: What does the Federal Reserve do, and how does it affect the U.S. dollar?
A: The Federal Reserve (Fed) is the institution that shapes monetary policy in the U.S. and influences the value of the U.S. dollar. The Fed has two main objectives: to achieve price stability and promote full employment, with interest rates as their primary tool.

If inflation rises above the 2% target, the Fed will increase interest rates to slow economic growth and make the U.S. dollar more attractive to international investors. Conversely, if inflation is low or unemployment is high, the Fed may lower interest rates to encourage lending, which can weaken the U.S. dollar.

Q: How often does the Fed hold monetary policy meetings?

A: The Fed holds eight policy meetings each year through the Federal Open Market Committee (FOMC), where economic conditions are assessed, and monetary policy decisions are made. The FOMC includes twelve Fed officials, including seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four presidents of regional Reserve Banks who serve on a rotating basis for one year.


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This explanation regarding "XAUUSD Today: January 9, 2024 - Fed Stops Gold Investor Expectations" is based on fundamental and technical insights from reliable sources and is not intended as advice or a recommendation. Always remember that this content aims to enrich the reader's information. Conduct your independent research regarding other forex information for reference in your trading.

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