{"id":99317,"date":"2025-01-29T15:20:00","date_gmt":"2025-01-29T13:20:00","guid":{"rendered":"https:\/\/ironfx-com-php8.wp-dev.int.theitops.net\/?p=99317"},"modified":"2025-01-30T14:25:52","modified_gmt":"2025-01-30T12:25:52","slug":"gold-outlook-fed-decision-day","status":"publish","type":"post","link":"https:\/\/www.ironfx-id.com\/es\/gold-outlook-fed-decision-day\/","title":{"rendered":"Gold Outlook: Fed decision day"},"content":{"rendered":"

Since our last report<\/a> , gold\u2019s upward direction seems to have been maintained last week yet the precious metal\u2019s price is currently lower than Monday\u2019s opening figure. In today\u2019s report, we are to discuss the possible implications of the Fed\u2019s interest rate decision later on today, and for a rounder view, we will conclude the report with a technical analysis of gold\u2019s daily chart.\u00a0<\/p>\n\n\n\n

Fed interest rate decision today<\/strong><\/strong><\/h2>\n\n\n\n

The Fed\u2019s interest rate decision<\/strong> is set to occur later on today. The majority of market participants are currently anticipating the bank to remain on hold in their meeting tomorrow, with Fed Fund Futures currently implying a 99.5% probability for such a scenario to materialize. The market<\/strong> also seems to expect the bank to proceed with a rate cut in the June meeting with a second rate cut potentially occurring in October. <\/p>\n\n\n\n

Nonetheless, with the markets having almost fully priced the possibility of the bank remaining on hold, our now attention turns to the bank\u2019s accompanying La Fed dej\u00f3 la configuraci\u00f3n de pol\u00edtica intacta manteniendo las tasas en 0.0-0.25% y las compras de<\/strong>, in addition to Fed Chair Powell\u2019s<\/strong> press conference<\/strong> which is set to occur half an hour after the decision. The first impact may be seen following the bank\u2019s accompanying statement, with a secondary effect emerging from the press conference. <\/p>\n\n\n\n

Overall, should Powell\u2019s<\/strong> press conference and accompanying statement be interpreted as predominantly hawkish<\/strong> in nature, i.e implying a prolonged period of time in which the bank could remain on hold, we may see the event aiding the greenback, whilst weighing on the precious metal\u2019s price given their assumed inverse relationship. <\/p>\n\n\n\n

On the other hand, should the accompanying statement and Powell\u2019s press conference be perceived as dovish in nature,\u00a0 it may weigh on the dollar, whilst aiding Gold\u2019s price. <\/p>\n\n\n\n

Lastly, should the two events appear to contradict<\/strong> one another, it may lead to a mixed market reaction. In our view, we would not be surprised to see the Fed<\/strong> taking a step back from the possibility of aggressive rate cuts and references being made to the administration\u2019s policies and their possible impact on the Fed\u2019s dual mandate.<\/strong><\/p>\n\n\n\n

The Trump Tariff Playbook<\/strong><\/h2>\n\n\n\n

The new administration<\/strong> may be preparing to impose tariffs on the 1 <\/sup> of February which is this Saturday. Specifically, we are referring to the comments made about a possible 25% tariff on imports to the US<\/strong> from Mexico<\/strong> y Canada<\/strong>, which President Trump<\/strong> has been referring to over the past week or so. <\/p>\n\n\n\n

Moreover, the President implied that he wishes to impose across-the-board tariffs that are much bigger than the 2.5% rate that was reportedly favoured by Treasury Secretary Scot Bessent per Bloomberg. Furthermore, over the weekend the President threatened a 50% tariff on Colombia<\/strong> after the nation\u2019s government initially denied entry to planes carrying migrants that were deported from the US. <\/p>\n\n\n\n

The bigger picture, in our view is that the President is willing to use tariffs as a negotiating tactic to the point where any \u201cconcessions\u201d such as a lower tariff rate may be considered \u201cmoderate\u201d. Nonetheless, the possibility of wide-ranging tariffs<\/strong> could lead to trade wars and heightened geopolitical tensions, which in turn could funnel inflows into the precious metal, given its status as a safe-haven asset.<\/p>\n\n\n\n

Gold Technical Analysis<\/strong><\/h2>\n\n\n\n

XAUUSD 4H Chart<\/strong><\/strong><\/h3>\n\n\n\n
\"XAU\/USD<\/figure>\n\n\n\n