Gold prices remain stable as investors await the Fed rate decision, driven by policy easing.

From Investing.com: 2024-12-17 02:32:00

Gold held steady above the $2,650 support level as investors await the Federal Reserve’s interest rate decision. The Fed is expected to lower rates by 25 basis points, with uncertainty about future reductions due to potential inflation under the new administration. US private sector activity expanded in December, potentially limiting rate cuts in the coming year. XAU/USD has gained 29% this year, driven by US policy easing, safe-haven demand, global central bank purchases, and geopolitical tensions.

The euro gained ground despite the US Dollar Index remaining high, as traders focused on political and economic news. Germany faces snap federal elections, but the market views it positively for a potentially more effective government. Eurozone PMIs showed growth in the services industry, offsetting manufacturing contraction. EUR/USD awaits the Fed decision and US inflation data this week for direction, with expectations of a 25-basis-point cut. The US Retail Sales report may add volatility to the pair.

The Australian dollar stayed steady as investors awaited the Fed meeting. Expectations are for a 25-basis-point rate cut, with reduced expectations for future easing due to inflation concerns. Private sector activity in Australia weakened, with a more pessimistic economic outlook. Bond yields in Australia fell following four weeks of increases. AUD/USD continued to trade sideways, with the US Retail Sales report expected to impact the pair’s movement.



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