XAU/USD Set for Biggest Weekly Gain Since Nov Amidst Optimism and Cautious Market
Despite the possibility of a calm market on Friday following a turbulent week, the GOLD price (XAU/USD) is on track for its largest weekly gains since early November, thanks to a three-week winning streak. As a result, the price of GOLD has risen slightly, breaking through the $1,925 resistance level amidst cautious optimism.
The potential for a bullish trend in XAU/USD may be strengthened by the decline in US Treasury bond yields and efforts by global politicians and bankers to prevent a recurrence of the 2008 financial crisis. Additionally, the Federal Reserve’s (Fed) reluctance to raise interest rates by 25 basis points (bps) despite mixed economic data in the United States could be related to the possibility of future rate hikes by the Fed. Furthermore, XAU/USD investors are optimistic about a sustained economic rebound in China, one of the world’s largest GOLD consumers.
However, investors do not appear to have much faith in the latest measures aimed at protecting the global banking sector, as they are deemed overly burdensome. GOLD dealers are apprehensive ahead of the Federal Open Market Committee (FOMC) monetary policy meeting next week, as major central banks have lowered expectations for easy rate hikes and have allegedly suppressed information about the causes of the latest banking crisis.
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