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Gold stuck in limbo as Fed dampens early rate cut hopes

The yellow metal held steady in Asian trading on Friday, struggling to break out of its recent $2,022-$2,032 rut as concerns over prolonged high-interest rates persisted. Spot gold (XAU/USD) was trading at $2,021 by 07:30 …

The yellow metal held steady in Asian trading on Friday, struggling to break out of its recent $2,022-$2,032 rut as concerns over prolonged high-interest rates persisted.

Spot gold (XAU/USD) was trading at $2,021 by 07:30 GMT, after reaching a high of $2,034 yesterday.

Gold was lower on Friday morning

While gold received a temporary boost earlier this week from a weaker dollar and muted Treasury yields, the outlook has turned cloudy after a slew of Fed officials, including Governor Christopher Waller, reiterated their commitment to keeping rates elevated until inflation shows more signs of cooling.

This hawkish stance, coupled with surprisingly strong labor market data, has pushed markets to almost entirely price out the possibility of a rate cut in May, further dampening investor appetite for gold.

The lack of key economic data releases today is unlikely to provide much direction for gold prices, leaving them vulnerable to the prevailing sentiment of higher-for-longer rates.

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