Investors are increasingly focusing on the coming US macroeconomic release, including Friday's PCE price index.
The forecast for US tariffs scheduled to begin on April 2 on imports from 15 trading partners further boosted the demand for gold as a hedge against trade-related uncertainty.
“Gold is supported by soft US data and weak dollars,” says a product strategist at a New York-based investment bank. “Rate-cut bets are increasingly being put into the market as the Fed is under pressure to act.”
Weaker US data enhances enormous bias
Recent data shows that it softens the economic situation. The conference committee's consumer confidence index fell to 92.9 in March. This was the lowest since 2020, but the forecast index fell to 65.2.
The US dollar has since withdrawn from recent highs and has supported non-revenue assets like Gold Gain Traction.
The Fed's current forecast includes two 25 base point rate cuts for 2024, but market prices suggest a more aggressive pass, with hopes for a cut that begins early in June.
