Gold Price Falls as Strong USD Puts Pressure on Non-Yielding Assets
The Gold price (XAU/USD) is struggling to stay above its 20-day exponential moving average (EMA), currently at $4,366.80, amid a broadly firm US Dollar (USD). The greenback's strength has put pressure on the yellow metal, which is down 0.61% to near $4,350 during the European trading session.
The USD Index (DXY) is up 0.1% to nearly 100.30, nearing its over-50 day high of 100.56 posted on Friday. Economists at NBC Economics and Strategy suggest that the Federal Reserve's (Fed) updated dot plot indicates a higher-for-longer interest rate policy bias, which bodes poorly for non-yielding assets like Gold.
From a technical perspective, the daily chart shows XAU/USD trading below its 20-day EMA, with a bearish near-term bias. The Relative Strength Index (RSI) around 49 indicates fragile upside momentum, while price action remains capped beneath this short-term trend gauge.