Gold Price Rebounds Amid Expectations of June Fed Rate Cut

Gold price has bounced back from $2,040 as investors anticipate a potential interest rate cut by the Federal Reserve in June. The recent release of the United States core Personal Consumption Expenditure Price Index (PCE) data for January, which showed a moderate slowdown in price pressures, has yet to dampen expectations for rate cuts. Instead, investors are closely monitoring upcoming events like Fed Chair Jerome Powell’s testimony before Congress and the labour market data for February to gauge the interest rate outlook.

The annual core inflation growth rate, the lowest in three years, and the monthly figures, which saw a 0.4% increase, have not significantly shifted market expectations for rate cuts. The February US Institute of Service Management (ISM) Manufacturing PMI data, scheduled for release later, will provide further insights into the US economic outlook.

Meanwhile, the Gold price is expected to close positively for the second consecutive week, remaining slightly bullish despite the inflation data. The US Dollar Index (DXY) is stable after a recent recovery, with some Federal Reserve officials signalling a potential interest rate cut later this year due to restrictive policy conditions.

Technically, the Gold price has advanced above $2,040, nearing the downward-sloping border of the Symmetrical Triangle pattern formed since December. The 14-period Relative Strength Index (RSI) indicates bullish momentum, with no divergence or oversold signals.

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