Gold prices continue to rise before the monetary policy meeting

Mohammed Abdelkhalik
September 21, 2021
Gold prices

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Gold prices rose during the trading session today in the European market, in the second daily gain in a row.

This comes at a time when investors are awaiting, later today, the launch of the monetary policy meeting of the Federal Reserve, which is supposed to provide more evidence about the timing of the start of reducing the bond purchase program.

Gold prices are back up to test the resistance level

Gold prices

At exactly 09:45 GMT, the spot price of gold was up by 0.2%, to trade around the level of 1768.20 US dollars per ounce, from the opening level of today’s session at 1764.60 dollars, and it reached the lowest price at 1757.93 dollars per ounce.

In US futures, gold rose more than 0.1% to $1,769.52 an ounce.

In terms of trading on Monday, the precious metal “gold” managed to achieve gains by 0.5%, recovering from its lowest level in a month and a half at $ 1742.02 an ounce recorded earlier in trading.

Other than that, and what provided more support for gold prices recently, investors’ aversion to risk and their focus on buying the metal as one of the best alternative safe havens, in light of growing concerns about the Chinese company Evergrande.

The US dollar index fell during today’s session by about 0.2%, in the second consecutive daily loss. This decline came within the continuation of the correction and profit-taking operations, after it reached its peak in four weeks at 93.45 points, reflecting the renewed selling of the US currency against most major and minor currencies, which contributes Currently, it supports the price movements of gold and other metals priced in dollars due to the existence of an inverse relationship between them.

Most global stock markets rebounded on Tuesday, thanks to attempts by the People’s Bank of China to allay fears about the crisis, “Evergrand”, the world’s most indebted real estate developer, which reduced dollar buying as the best alternative investment.

Monetary policy meeting

Financial markets are closely awaiting later today, Tuesday, the launch of the activities of the Federal Reserve (US Central Bank) meeting, to discuss appropriate monetary policies for the developments of the largest economy in the world, to issue its decisions tomorrow, Wednesday, amid the full possibilities that indicate the survival of US interest rates. Fixed at 0.25% range.

And as we know that easing monetary policy adds more pressure on US bond yields and benefits gold, which does not yield a return.

Author Mohammed Abdelkhalik

Professional Trader and Analyst, economist in Financial and Forex market since 2004.holds an MBA from the American University in Egypt. Mohammed works as an economic writer and technical & fundamental analyst for many international Forex and financial trading companies in both English and Arabic on a daily basis.