Category: finance

The post XAU/USD tumbles to near $3,950 on Fed’s hawkish comments, trade optimism appeared on BitcoinEthereumNews.com. Gold price (XAU/USD) slumps to near $3,965 during the early Asian session on Monday. The precious metal extends the decline as a constructive US-China outcome reinforces global risk appetite. Traders await the release of the US ISM Manufacturing Purchasing Managers’ Index (PMI) data for October, which is scheduled for release later on Monday. US President Donald Trump and Chinese President Xi Jinping agreed to avoid escalation in their trade war last week. Trump decided to lower his tariff from 57% to 47% in exchange for China suspending export controls on its rare earths and increasing purchases of American soya beans. Positive developments surrounding the US-China trade deal could reduce the demand for safe-haven assets and undermine the Gold price Additionally, the hawkish remarks from the Federal Reserve (Fed) officials contribute to the yellow metal’s downside. The US central bank lowered its benchmark overnight borrowing rate at its October meeting last week to a range of 3.75%-4.0%. Fed Chair Jerome Powell said during the press conference that a further reduction in the policy rate at the December meeting is not a foregone conclusion. The markets are discounting a 63% odds that the Fed will cut the fed funds target range by 25 basis points (bps) at the December meeting. The markets are discounting an overall 82 bps rate reduction by the end of 2026 to 3.06% from the current effective federal funds rate of 3.88%. The US ISM October Manufacturing PMI data could offer some hints about the US economic outlook. If the report shows a weaker-than-expected outcome, this could drag the US Dollar (USD) lower and provide some support to the USD-denominated commodity price in the near term. Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value…