The Fed Minutes should provide clairity on Gold's direction

4月10日

The commodities space is thriving thanks to the positive influence of geopolitics, central bank buying, a surge in manufacturing, and a robust economy. These factors have ignited a widespread rally in the precious metals space, painting a promising picture for investors and traders.

Today, we are eagerly awaiting the release of the March CPI print, a crucial economic indicator. The consensus is that the core CPI will show a month-over-month increase of +0.3% and a year-over-year increase of 3.4%. Additionally, the CME FedWatch tool suggests a 50/50 chance of a 25 bps interest rate cut in June, adding to the anticipation.

Later in the session, we will have the March FOMC minutes, where Fed officials previously projected three interest rate cuts in 2024 and cited, "We are not concerned about January and February's higher than expected inflation data." Today's number could confirm that January and February were just a "bump in the road." So we continue to hang on the balance of two to three interest rate cuts.

The path of least resistance looks to remain higher in Gold, fueled by Central Bank buying, a softer U.S. Dollar, and weaker treasury yields, despite a repricing from six interest rate cuts in 2024 to now two or three. We will continue to monitor $2400 as the next likely upside target, while $2350 remains critical support.

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