Price of Gold Fundamental Daily Forecast – Minutes Could Reveal Fed’s Thoughts on Rates, Volatility and Tariffs
Gold futures remained supported early Wednesday by jitters over a possible trade war. Lower equity prices and a weaker U.S. Dollar also underpinned the safe-haven asset. Investors were also positioning themselves ahead of Wednesday’s report on U.S. consumer inflation and minutes from the Federal Reserve’s March meeting. Geopolitical concerns over the possibility of additional airstrikes against Syria are also underpinning prices today.
At 0747 GMT, June Comex Gold futures are trading higher at $1348.40, up $2.50 or +0.18%.
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In other news on Tuesday, U.S. producer prices increased more than expected in March, buoyed by rising health care costs and airline fees, suggesting a buildup of wholesale inflation.
The Labor Department said that its producer price index for final demand rose 0.3 percent last month after increasing 0.2 percent in February. The so-called core PPI that excludes volatile food, energy and trade services rose 0.4 percent last month.
Core PPI increased 2.9 percent in the 12 months through March, the biggest increase since August 2014, according to Reuters.
Forecast
Although the Labor Department’s consumer price index is due at 1230 GMT, gold traders are likely to put more weight on the escalating tensions in the Middle East and lingering concerns over a possible trade war between China and the United States.
Traders will be watching today’s CPI report to see if March consumer inflation data will run hotter than expected Wednesday, just as producer prices did Tuesday.
The consumer price index is expected to be up 2.4 percent on a year-over-year basis in March, and 2.1 percent on core inflation, which excludes food and fuel.
Gold traders will also get the opportunity to react to the latest Fed minutes, due to be released at 1800 GMT.
Traders will be looking at the minutes for clues as to the Fed’s opinion on additional rate hikes, stock market volatility and the Trump administration’s tariffs.