GOLD - Gold trading strategy

2 нояб. 2023 г.

Many experts predict that the US economy may fall into recession this year due to the rapid pace of interest rate increases. However, the world's largest economy is surprisingly strong.

In its statement, the Fed emphasized that the US economy was still growing strongly in the third quarter, the unemployment rate was low and the banking system was resilient. This has strengthened the possibility that the US will achieve a "soft landing" as the Fed is curbing inflation without harming the economy.

Although the Fed left interest rates unchanged after its monetary policy meeting, Fed Chairman Jerome Powell said it was unclear whether the committee was done raising rates. The world's most powerful central bank president also added that the committee remains focused on bringing inflation down to its 2% target.

Some experts assess that although the Fed maintains its tightening trend, that stance is not "hawkish" enough to worry the gold market as prices keep high levels below 2,000 USD/ounce.

Although the Fed is still pursuing a "hawkish" policy, it is not enough to spook the market, said Edward Moya, senior market analyst at OANDA.

This expert further noted that concerns related to the Israel-Hamas conflict may have more impact on gold than the Fed's monetary policies.