Support
Gold volatile as markets await Trump and Powell
Attention is split between global trade tensions, Federal Reserve commentary, and the direction of major assets like currencies and gold
The Australian Dollar stands out due to increased volatility
USD remains relatively strong
Gold pullback from its recent all-time high
The markets are showing limited movement at the start of today’s session, with major currency pairs largely unchanged. Trump’s push for new tariffs on steel and aluminum remains a focal point, with the new 25% tariffs set to cancel all existing agreements and take effect on March 4. While this development stirs concerns over global trade, there’s still a prevailing sense that negotiations may lead to some adjustments, keeping market reactions relatively muted.
Currencies
Australian Prime Minister Albanese initially hinted that Trump might exempt Australia from the tariff changes, giving the AUD a boost. However, Trump quickly quashed those expectations, announcing there would be no exemptions. This shift sparked a notable market reaction, leading to a more volatile day for the Australian currency.
Over the coming days, all eyes will be on any new comments from Trump, as well as Fed Chairman Jerome Powell’s testimony before Congress. Powell’s speech, expected to provide insight into the Fed’s future policy, will be watched closely, and snippets of his comments are likely to surface ahead of his formal appearance.
The US Dollar is showing modest strength in today’s trading, driven by expectations that the Federal Reserve will hold interest rates steady despite inflation concerns. The resilience of the US labor market continues to support the idea of a cautious approach from the Fed, with no immediate need for rate hikes. As a result, the USD remains relatively strong, prompting some traders to take profits on gold, which has seen limited further gains. The dollar’s strength is also being supported by the overall market sentiment, which remains on edge as geopolitical risks and global trade tensions continue to shape investor behavior.
Gold
Gold continues to hover above the $2,900 level, despite a slight pullback from its recent all-time high above $2940. The metal is benefiting from renewed fears of a global trade conflict, yet the slight strengthening of the US Dollar has led to some profit-taking in gold, capping its potential for the time being.
