On Tuesday, gold formed a downward movement amid further USD dollar strengthening. As a result, the trading session was closed with a result of -0.7%. Today, trading is going around yesterday's lows.
The general investor focus is still upon Fed policy. The forecast of a slowdown in the global economy, the skepticism of Fed individual representatives, as well as the decline of some statistical indicators contribute uncertainty to further actions by the Fed. However the situation can be clarified by FOMC November meeting, which will be presented tomorrow, as well as comments by the head of the Fed Jerome Powell, who is due today to give a speech in the middle of the American trading session.
Yesterday, traders closely followed the performances of some FOMC representatives, who gave predictions about the further development of the economy, as well as the regulator intentions to change interest rates. In particular, Fed Vice President Clarida said yesterday that the US economy looks strong and if inflation continues to speed up, the regulator may speed up the process of normalizing interest rates, but for now inflationary expectations remain restrained. These statements gave the main impetus to lower gold prices in yesterday's trading, as the yellow metal is very sensitive to changes in the Fed's policy, and with high rates of interest rate increase, the pressure will only increase.
Investors also continue to actively monitor the preparation of a meeting between the US President and the head of China. Trump's comments to the Wall Street Journal have significantly reduced investors' expectations regarding the positive outcome of this meeting, which is a strong support factor for USD dollar. At the same time, important economic data is scheduled for publication in the US today, which will shift the attention of traders from geopolitical news back to the economy. United States will release preliminary data on third-quarter GDP growth. In the second assessment, experts predicts growth from the previous 3.5% to 3.6%, which could further strengthen the position of the dollar. In addition, investors will closely monitor the data on the trade balance and sales of new housing, but the key event of the day is likely to be the performance of Jerome Powell in New York.