Although it has langered over the past two weeks, the gold price could be poised to retest the $2050 level, with all eyes on how the metal could perform in March of 2024. Indeed, the asset has flourished through safe-haven demand amid the US dollar’s weakened state. Yet, there is still uncertainty as to when the Federal Reserve could finally cut interest Rates.
Gold had neared its two-week high of $2041 in early trading on Tuesday. Moreover, critical US economic data could further impact the trajectory the metal is placed on for the rest of the month. Yet, further information regarding the Fed’s decision could be key to knowing what to expect from Gold in March.
Also Read: US Dollar Weakened: Gold Price Passes $2040
Gold Price Seeking Path Back to $2050; Could it Happen This Month?
Throughout the second half of 2023, the price of gold had performed impressively. Amid the fragile US economy, the asset managed to record a new all-time high within that time. Specifically, it ascended to a value of $2135 in December of last year. Yet, that has not been the case thus far in 2024.
Despite the optimism that investors and experts had for the metal, it has not yet matched those tremendous highs. Still, it has performed better than expected amid burgeoning uncertainty in the financial sector. Subsequently, the gold price is seeking to retest $2050, but could it reach the total in March 2024?
The metal has benefited from a slumping US dollar but has been noticeably held back by the Federal Reserve’s resistance to cut interest rates. These interest rate cuts have long been viewed as a catalyst for the metal’s price. However, the market is currently pricing in an 80% chance of no interest rate cuts in May.
Also Read: Gold Prices Reach $2,030: Why Is the Precious Metal Rising?
Moreover, the probability for the following months has lowered. The probability for interest rate cuts from the Fed in June is now at 60%, which is down from the previously recorded 70%. Alternatively, Fed policymakers have been hawkish and attempted to lower interest rate cut expectations.
Amid these factors, FX Street notes that gold’s upcoming upside target is its previously mentioned two-week high of $2041. Thereafter, the metal is facing off against the $2050 psychology level.
Major US economic information is set to be released, and that should provide a clear picture of what’s to come. Although $2050 remains immensely optimistic, failing the resistance could lead March to lower the asset to between $2021 and $2028.