Gold traded relatively narrow during the early Asian session today. The market situation became more cautious heading into the week as the US central bank was very busy with policy setting and some important data by the Bank of Japan (BoJ).
Meanwhile, the US Dollar Index (DXY) is also moving tight which is around 103.32 and US Treasury yields are gaining with the 10-year yield at 4.10%.
However, gold prices traded slightly lower at $2020.66, down 0.06% today.
Markets now see no change in interest rate setting from this month's Federal Open Market Committee (FOMC) meeting. Investors should reduce the projected easing to five quarters of a percent from the previous six points.
The likelihood of a rate cut at the March meeting fell to 42% compared to the previous expectation of 70%.
Based on the statements of several Federal Reserve officials, Governors Christopher Waller, John Williams and Raphael Bostic said that they are in no rush to cut interest rates even though the expectation is getting stronger.
This week, some important economic data will be indicators such as the US Gross Domestic Product (GDP) report for the fourth quarter on Thursday and the Core Personal Consumption Expenditure Price Index (Core PCE) on Friday.
If there is a weakness in US economic data, this will push the Fed to take a dovish stance and give credit to gold prices.
Today, investors should pay attention to the US Richmond Fed Manufacturing Index report for January.
