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The price of gold is currently moving in a lateral direction, hovering around the $1,930 mark. Traders are anticipating that the Federal Reserve (Fed) will maintain interest rates at their current levels of 5.25% to 5.50% during its September meeting.
The focus is on the upcoming Fed meeting, which will take place before rate decisions from the Bank of England (BoE) and Bank of Japan (BoJ).
As predicted, the Federal Reserve chose to keep the current benchmark policy rates at 5.5% during their meeting on Wednesday.
Furthermore, it is expected that the central bank will implement another rate hike in 2023, aligning with the projection of slightly higher inflation by the Federal Open Market Committee (FOMC) compared to their previous forecasts.
Therefore, Federal Reserve officials unexpectedly adjusted their projected interest rates for 2024, raising them from 4.6% to 5.1%. This modification played a significant role in bolstering the strength of the US Dollar (USD).
The US Dollar Index (DXY), which measures how well the Greenback performs against six other major currencies, continues to increase and is currently trading at a six-month peak of approximately 105.50.