Despite the dollar’s bounce, gold remains underpinned by expectations of monetary easing. Markets are pricing in a 23% chance of a July interest rate cut and a 75% probability of easing by September, according to CME’s FedWatch Tool.
Recent remarks from Fed Chair Jerome Powell suggested the central bank might have already begun rate cuts if not for ongoing uncertainty in trade and inflation projections. Meanwhile, U.S. economic indicators continue to show mixed signals.
The ISM Manufacturing PMI contracted for the fourth straight month, and job openings rose to 7.769 million in May, slightly above estimates. While this eases labor market concerns, it does little to shift recession anxieties, leaving investors cautious ahead of this week’s ADP and NFP reports.
Silver Supported by Weaker Dollar, Trades Near $36
Silver (XAG/USD) extended its sideways consolidation, trading at $36.04. As trade tensions and central bank policy uncertainty mount, both gold and silver continue to attract interest as portfolio stabilizers. However, upcoming U.S. labor data will be critical in determining whether precious metals can sustain recent gains or resume their broader consolidation patterns.
Short-Term Forecast
Gold trades below $3,358 while silver hovers near $36.04. Fed commentary, rate expectations, and labor data weigh on market sentiment.
