Gold Price Forecast: XAU/USD loses ground below $2,700 amid firmer US Dollar
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Gold price loses ground to around $2,690 in Monday’s early Asian session.
The upbeat US job report and surging USD weigh on the Gold price.
Trump's policy uncertainty and geopolitical risks might cap the downside for the precious metal.
Gold price (XAU/USD) trades with mild losses near $2,690 on the stronger US Dollar (USD) broadly during the early Asian session on Monday. However, the safe-haven demand due to uncertainty surrounding the President-elect Donald Trump administration's policies might help limit the Gold’s losses.
The stronger-than-expected US employment data on Friday reinforced expectations that the US Federal Reserve (Fed) might not cut interest rates as aggressively this year. This, in turn, weighs on the non-yielding asset. Traders expect the Fed to cut interest rates by just 30 basis points (bps) over the course of this year, compared with cuts worth about 45 bps before the NFP report.
On the other hand, Trump's policy risks boosting the Gold price, a traditional safe-haven asset. "Gold is still acting resilient in the face of a much stronger-than-expected jobs report ... One of the factors that's been supporting gold is this uncertainty that we've seen going into the (U.S. presidential) inauguration," said David Meger, director of metals trading at High Ridge Futures.
Additionally, the escalating geopolitical tensions in the Middle East and the ongoing Russia-Ukraine conflict might contribute to the precious metal downside. Israeli strikes continued throughout Gaza, including attacks near Gaza City, Nuseirat, and Bureij. Two attacks were also reported in the Houmin Valley in southern Lebanon, according to Lebanon’s National News Agency.
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