Yesterday, gold was hovering between the green and red zones receiving positive and negative signals. As a result, the asset scored gains at the end of the previous trading day.
The ECB's decision to slow down the pace of bond purchases in the last quarter of 2021 provided support to the precious metal.
After ECB President Christine Lagarde's speech, the euro went up, 10-year bond yields decreases, and the greenback remained firm.
Dovish monetary policy comments of the European regulator helped the US dollar to maintain its position. Like Fed Chair Jerome Powell, Christine Lagarde said that cutting asset purchases does not signal monetary policy tightening.
Optimistic jobs market data in the US boosted the greenback on Thursday. Initial jobless claims dropped by 35K to 310K in the previous week, which was the lowest level since the beginning of the pandemic.
Yesterday, gold incurred losses amid rapid recovery hopes in the US.
On Thursday, the precious metal was trading in a very narrow price range, hovering between the low and high. At the end of the day, the price closed up by 0.4%, or $6.50, settling at the key level of $1,800.
Early on Friday, the asset remained flat, showing a slight increase. At the time of writing, the quote rose by 0.25%, or $4.55, and was trading at the level of $1,804.55.
The market continues to digest the outcome of the ECB's Governing Council meeting and the unemployment results in the United States. That is why gold is trading sideways. At the same time, the greenback remains the main driver of gold's performance. Gold is expected to trade sideways until the greenback is set in motion.
The Fed's September meeting remains the main trigger for both assets. The US regulator is believed to announce the exact time of tapering during this meeting.
The other day, Robert Kaplan, President of the Federal Reserve Bank of Dallas, said he would be advocating for the reduction in asset purchases as soon as possible. Meanwhile, Raphael Bostic, the President of the Federal Reserve Bank of Atlanta suggested that the Fed needed more time.
Amid ongoing uncertainty about the future of tapering, calm trading is expected in the gold market if, of course, the greenback does not plunge unexpectedly.
