FX.co ★ Gold Holds Near 2-Week High

Gold maintained its position around $3,375 per ounce on Wednesday, preserving the majority of its recent gains and staying close to a two-week high. This stability is primarily driven by rising expectations for a more relaxed monetary policy, which bolsters the appeal of the non-yielding metal. Recent U.S. data indicated a decline in the ISM services index for July, falling short of forecasts and highlighting sluggish economic growth, declining employment, and increasing price pressures. Additional data from the previous week suggested continued weakness in the labor market and consumer spending. These indicators of economic frailty in the world’s largest economy have bolstered the anticipation that the Federal Reserve will move towards easing its policy at its upcoming September meeting. Current market sentiment suggests a 90% probability of a rate cut. Furthermore, gold's appeal is enhanced by President Trump's latest series of tariffs and renewed concerns regarding the independence of the Fed, following Governor Kugler’s resignation. This resignation affords President Trump the chance to appoint a successor with a more dovish stance.