GOLD PULLS BACK TO $2,500 AS USD RECOVERS
- Gold is correcting back as the US Dollar recovers from year-to-date lows.
- Mixed US economic data is making the market cautious about whether the Fed will cut by 0.50% in September.
- The heavy long positioning in Gold is a further headwind for bulls trying to push the price higher.
Gold (XAU/USD) exchanges hands just above $2,500 on Wednesday after sliding lower due to a rebound in the US Dollar (USD). Given Gold is mainly priced in USD, any strength in the Greenback tends to weigh on its price. The US Dollar Index (DXY) is up over a third of a percent in the 100.90s on Wednesday, rebounding from the 100.51 year-to-date lows touched on the previous day.
US data was mixed on Tuesday, with the Conference Board’s gauge of Consumer Confidence in August rising to 103.3 and beating expectations of 100.7. The optimism coming from the US consumer provided further evidence against a hard-landing scenario for the US economy. Labor market indicators, however, “fell to their weakest levels so far in this cycle, which supported concerns about the recent slowdown in the labor market,” according to Jim Reid, a strategist at Deutsche Bank.
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