The US dollar is slightly down against the other major currencies during early Monday trading, but still close to the multi-month highs reached last week as investors have their attention set on the Fed’s policy statement, which is due to be released on Wednesday. The recent strength of the greenback has to a large extent been supported by the pricing-in of the Fed’s hawkish pivot, so the build-up to Wednesday will provide a snapshot of investors’ expectation over the tone of the announcement, one which can further accentuate the central bank’s leaning towards bringing forward the timing of the tightening of policies, or, perhaps instead reflect new worries over the fast spread of the Delta variant in the US.
Gold is edging higher during early Monday trading, due to the inverted correlation with the US dollar, which is losing some ground as the trading week gets underway. The performance of the dollar is expected to remain gold’s main driver during the week ahead. Gold traders will be paying close attention to the Fed’s policy statement, due to be released on Wednesday, as it is likely to have an impact on the dollar, depending on whether FOMC officials continue to move closer to earlier tightening, or instead reveal fears over the spread of the new Delta variant. The latter is likely to support the price of gold while the former could weaken it by propelling the dollar to new heights.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.