Gold price struggles to gain traction and is influenced by a combination of diverging forces.
Doubts about whether the Fed will cut rates three times this year lift the USD and cap gains.
A softer risk tone, along with geopolitical risks, lends support to the safe-haven commodity.
Gold price (XAU/USD) attracts some dip-buying during the Asian session on Wednesday and, for now, seems to have stalled the previous day's late pullback from the $2,200 psychological mark. The Federal Reserve (Fed) indicated last week that it remains on track to cut interest rates by 75 basis points in 2024. This, along with a softer risk tone amid concerns about geopolitical risks stemming from the protracted Russia-Ukraine war and conflicts in the Middle East, turns out to be key factors lending some support to the safe-haven precious metal.
The upside for the Gold price, however, seems limited in the wake of some follow-through US Dollar (USD) buying, supported by Tuesday's better-than-expected release of US Durable Goods Orders. The data validated the view that the US economy is in good shape, which, along with sticky inflation, might force the Federal Reserve (Fed) to keep interest rates higher for longer. The outlook remains supportive of elevated US Treasury bond yields and lifts the USD closer to a multi-week top touched last Friday, which might cap gains for the non-yielding yellow metal.
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