Gold prices closed the week with rising. The most important developments this week were the US Federal Reserve’s (FED) interest rate statement and GDP data. On the other hand, Bitcoin and altcoins also benefited from these explanations. Bitcoin has hit two-month highs. Altcoins have also followed BTC’s bullish momentum. So, what are the things that will be the catalysts for gold, Bitcoin and altcoins in the near term? Here are the details…
Gold price ended the week with rising
Gold price rose close to 2.39 percent last week. Meanwhile, the US Federal Reserve (FED) carried the positive momentum forward with its slightly firm stance on interest rate hikes. As we have also reported as Kriptokoin.com, the US FED increased the interest rate by another 75 basis points in the fight against inflation. However, the US FED encouraged buying a “safe haven” for gold, alleviating concerns about the forthcoming rapid rate hike.
Besides, the dollar index suffered for the second week in a row. This also supported gold prices. Weak US GDP data also led to the rise in gold prices. However, investors are advised to be cautious about various events in the coming week. Here are the most important developments for gold in the near term…
BoE meeting and US jobs data
The Bank of England (BoE) has already increased interest rates five times since December 2021. While inflation is at its highest level in four decades, a half-point increase in interest rates is among the options on the table as the central bank implements a mandatory policy. “Additionally, future guidance from the BOE will be crucial in dictating movements in the pound as well as the dollar index,” said Sugandha Sachdeva, Vice President of Commodities and Currency Research at Religare Broking. Therefore, according to the expert, the BoE will affect gold prices.
Meanwhile, US nonfarm payrolls and employment data will provide clues about the health of the US job market. It will guide the way forward of the Fed’s monetary policy. Anuj Gupta, Vice President of Research at IFL Securities, used the following statements in his statements on the subject:
After weak US GDP data, if US jobs data also disappoints, the dollar index could witness sharp profit bookings. It may drop below the 105 level. In this case, gold is expected to emerge as the ‘safe haven’ of investors, as farm yields are also decreasing day by day.
What will the OPEC meeting show?
During the week, attention will be on the meeting of OPEC and its allies. According to Sugandha Sachdeva of Realigare Broking, this meeting is also crucial in shaping the course of crude oil prices. Therefore, it can give clues about the inflation trajectory. The expert said, “The eyes will be on the production policies. Most members don’t have much spare capacity. So it will be difficult for the group to increase production significantly,” he said.
What other developments to follow this week?
Data released this week showed US economic growth contracted modestly in the second quarter. Data on new home sales pointed to a calming housing market. The FOMC continued its fight against hyperinflation with the second consecutive 75 basis points increase in interest rates. On the other hand, in the last few months, concerns about the global economic outlook have intensified. Projections of possible recessions around the world have become more common.
- Data to watch in the US next week: ISM Manufacturing (Mon), Balance Sheet of Trade (Tue), Employment (Fri)
- Data to watch globally next week: RBA Cash Rate (Tue), BCB Selic Rate (Wed), BoE Bank Rate (Thu)
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