Gold Price Ticks Higher Amid Softer Risk Tone, Upside Potential Seems Limited

SEATTLE (Scrap Monster): Gold price (XAU/USD) ticks higher on Tuesday and for now, seems to have snapped a two-day losing streak to the $2,015 area, or over a one-week low touched the previous day. The uptick is sponsored by a slight deterioration in the global risk sentiment, which tends to underpin the safe-haven precious metal. Furthermore, a modest downtick in the US Treasury bond yields exerts some pressure on the US Dollar (USD) and lends additional support to the commodity.

The markets, meanwhile, have fully priced out the possibility of early interest rate cuts by the Federal Reserve (Fed) in the wake of the incoming stronger US macro data, which pointed to a still resilient economy. Adding to this, the recent hawkish remarks by several Fed officials suggested that the US central bank will keep interest rates higher for longer. This should act as a tailwind for the US bond yields, which favours the USD bulls and might cap the non-yielding Gold price. 

 Courtesy: www.fxstreet.com