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GOLD: Weaker Ahead Of Today’s FOMC Decision

GOLD
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Gold is 0.2% higher in today’s Asia-Pac session, after closing 0.5% lower at $2569.50 on Tuesday following stronger-than-expected US IP and retail sales data.

  • However, US retail sales and industrial production data delivered few clues for today’s FOMC outcome. Retail Sales headline beat with a slight upward revision to prior data (0.1% M/M (vs -0.2%, 1.1% prior rev up 0.1pp). Meanwhile, IP was much stronger than expected in August at 0.8% M/M (cons 0.2) but there was a downward revision.
  • US Treasuries finished weaker across benchmarks after US yields briefly fell to one-week lows early in the NY session. The session for US Treasuries reflected position squaring ahead of today’s FOMC policy announcement. The markets still project closer to a 50bp cut than a 25bp move from the Fed. Lower rates are typically positive for gold, which doesn’t pay interest.
  • According to MNI’s technicals team, a bullish structure in gold remains intact, with the focus on $2,600.Firm support lies at $2,520.7, the 20-day EMA.
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Gold is 0.2% higher in today’s Asia-Pac session, after closing 0.5% lower at $2569.50 on Tuesday following stronger-than-expected US IP and retail sales data.

  • However, US retail sales and industrial production data delivered few clues for today’s FOMC outcome. Retail Sales headline beat with a slight upward revision to prior data (0.1% M/M (vs -0.2%, 1.1% prior rev up 0.1pp). Meanwhile, IP was much stronger than expected in August at 0.8% M/M (cons 0.2) but there was a downward revision.
  • US Treasuries finished weaker across benchmarks after US yields briefly fell to one-week lows early in the NY session. The session for US Treasuries reflected position squaring ahead of today’s FOMC policy announcement. The markets still project closer to a 50bp cut than a 25bp move from the Fed. Lower rates are typically positive for gold, which doesn’t pay interest.
  • According to MNI’s technicals team, a bullish structure in gold remains intact, with the focus on $2,600.Firm support lies at $2,520.7, the 20-day EMA.