Gold – Will the Fed hint at a March cut or just leave the door slightly ajar?

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<li data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><strong>Fed statement and press conference key</strong></li>
<li data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><strong>Will they hint at a rate cut in March?</strong></li>
<li data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><strong>Gold hovering between $2,000 and $2,500</strong></li>
</ul>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-node="text">It’s been a relatively slow start to trading on Wednesday which isn’t surprising considering what’s to come later in the day.</span></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-node="text">On another day, earnings from Alphabet and Microsoft may have dictated sentiment in the broader markets but as it is, investors are more focused on events in Washington, so tech aside markets are relatively flat.</span></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-node="text">There’s a very good reason why this is the case. Stock markets have been driven by two things over the last year, the explosion of AI and its seemingly endless possibilities and interest rate prospects. The latter is more important for most companies and the economy this year. </span></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-node="text">Markets have priced rate cuts extremely aggressively over the last couple of months but have pared these back slightly as we’ve got closer to today’s decision. At times, March was viewed as a banker for a rate cut and now it looks more of a coin toss, while in recent weeks 175 basis points were almost fully priced in this year; now it’s closer to 125.</span></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-node="text">Whether that remains the case will partly depend on the Fed’s messaging today. Remember, it was the December dot plot that triggered such a flurry of optimism into year-end. Will the Fed further fuel that or push back? </span></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-node="text">I expect Powell and his colleagues may opt for language that leaves the door open to a rate cut in March without giving the impression that it’s likely. Flexibility is key at this stage and there’s a lot of important data over the next six weeks that could fully justify beginning the easing cycle and policymakers will be very aware of that.</span></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><iframe loading="lazy" width="560" height="315" src="https://www.youtube.com/embed/ahh5x0uQGGY?si=SLzV1F82pQ3k6az3" title="YouTube video player" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen></iframe></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><strong>Stuck in a range ahead of the Fed</strong></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-fragment="JTVCJTdCJTIydHlwZSUyMiUzQSUyMnBhcmFncmFwaCUyMiUyQyUyMmNoaWxkcmVuJTIyJTNBJTVCJTdCJTIydGV4dCUyMiUzQSUyMkdvbGQlMjBhcHBlYXJzJTIwc3R1Y2slMjBiZXR3ZWVuJTIwJTI0MiUyQzAwMCUyMGFuZCUyMCUyNDIlMkMwNTAlMjBhdCUyMHRoZSUyMG1vbWVudCUyQyUyMHRvcm4lMjBiZXR3ZWVuJTIwdGhlJTIwcHJvc3BlY3QlMjBvZiUyMG11bHRpcGxlJTIwcmF0ZSUyMGN1dHMlMjB0aGlzJTIweWVhciUyMGFuZCUyMHRob3NlJTIwZXhwZWN0YXRpb25zJTIwYmVpbmclMjBwYXJlZCUyMGJhY2slMjBpbiUyMHJlY2VudCUyMHdlZWtzLiUyMFRoZXJlJTIwcmVtYWlucyUyMGElMjBwbGVudHklMjBvZiUyMG9wdGltaXNtJTIwdGhhdCUyMHJhdGVzJTIwY291bGQlMjBmYWxsJTIwYSUyMGxvdCUyMHRoaXMlMjB5ZWFyJTIwd2hpY2glMjBoYXMlMjBlbmFibGVkJTIwdGhlJTIweWVsbG93JTIwbWV0YWwlMjB0byUyMHJlbWFpbiUyMGFib3ZlJTIwJTI0MiUyQzAwMC4lMjBCdXQlMjB0aGUlMjBkYXRhJTIwbmVlZHMlMjB0byUyMGRlbGl2ZXIlMjBhbmQlMjBzb21lJTIwZG92aXNoJTIwbWVzc2FnaW5nJTIwZnJvbSUyMHRoZSUyMEZlZCUyMHRvZGF5JTIwd291bGRuJ3QlMjBkbyUyMHRoZSUyMHByaWNlJTIwYW55JTIwaGFybSUyMGVpdGhlci4lMjIlN0QlNUQlN0QlNUQ=">Gold appears stuck between $2,000 and $2,050 at the moment, torn between the prospect of multiple rate cuts this year and those expectations being pared back in recent weeks. </span></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><strong>Gold Daily</strong></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><a href="https://www.marketpulse.com/wp-content/uploads/2024/01/EOnhYH8p.png" target="_blank" rel="noopener"><img loading="lazy" class="aligncenter wp-image-809655" src="https://www.marketpulse.com/wp-content/uploads/2024/01/EOnhYH8p-1024×566.png" alt="" width="620" height="342" srcset="https://www.marketpulse.com/wp-content/uploads/2024/01/EOnhYH8p-1024×566.png 1024w, https://www.marketpulse.com/wp-content/uploads/2024/01/EOnhYH8p-300×166.png 300w, https://www.marketpulse.com/wp-content/uploads/2024/01/EOnhYH8p-768×424.png 768w, https://www.marketpulse.com/wp-content/uploads/2024/01/EOnhYH8p-1536×848.png 1536w, https://www.marketpulse.com/wp-content/uploads/2024/01/EOnhYH8p.png 1778w" sizes="(max-width: 620px) 100vw, 620px" /></a></p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element">Source – OANDA</p>
<p data-slate-block="regular" data-slate-type="paragraph" data-slate-value="{" data-slate-node="element"><span data-slate-fragment="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">There remains a plenty of optimism that rates could fall a lot this year which has enabled the yellow metal to remain above $2,000. But the data needs to deliver and some dovish messaging from the Fed today wouldn’t do the price any harm either.</span></p>