Gold price jumps higher as Middle East tensions deepen.
The US Dollar tumbles despite FOMC minutes indicating a hawkish narrative.
Investors await US S&P Global PMI data, which will shed some light on the economic outlook.
Gold price (XAU/USD) prints a fresh weekly high above $2,030 in Thursday’s European session. The precious metal extends its winning streak to the sixth trading session amid a weak outlook for the US Dollar and escalating Middle East tensions. Generally, the appeal for safe-haven assets such as Gold improves during geopolitical uncertainty.
The US Dollar is under pressure even though the Federal Open Market Committee (FOMC) Minutes of the late January policy meeting indicated that the majority of Federal Reserve (Fed) policymakers are in no hurry to unwind the restrictive monetary policy stance.
Fed policymakers are expected to keep interest rates unchanged in the range of 5.25%-5.50% until they get convinced that price stability can be achieved. Easing price pressures for some months could build confidence among Fed policymakers that inflation will sustainably decline to the 2% target.
On the geopolitical front, Middle East tensions have escalated as Israel intensifies its attacks in Rafah, which is a Palestinian city at the southern end of Gaza. Last week, Israeli Defense Minister Yoav Gallant identified Rafah as a shelter for over 1.4 million Palestinian refugees.
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