Yesterday’s Slide Extends Into Today’s Asian Session

Gold is under heavy pressure in today's Asia-Pacific session, down 0.9%, after closing 0.5% lower at $2,397.70 yesterday.

• Bullion’s recent drop comes despite former NY Fed President Dudley suggesting rate cuts were warranted now, not later in the year. Projected US rate cut pricing into year-end strengthened from Tuesday’s levels: Sep'24 cumulative -27bps (-25bps), Nov'24 cumulative -43bps (-40bps) and Dec'24 -65bps (-63bps).
• Lower rates are typically positive for gold, which doesn’t pay interest.
• The market focus now turns to Advance Q2 US GDP later today and Friday’s update on the Fed’s preferred underlying inflation measure. The PCE deflator is expected to have retreated to an annual pace of 2.5% from 2.6% in the year to May.
• According to MNI’s technicals team, the medium-term trend for gold still points higher and the previous breach of key resistance at $2,450.1, the May 20 high, opens the $2,500.00 handle next. Initial support is at $2,393.8, the 20-day EMA.