Gold (XAU/USD) pushed above $4,050 in early European trading on Monday as investors grappled with mixed signals from the US economy. Disappointing private‐sector payrolls and a weaker University of Michigan consumer‐sentiment reading rekindled bets on Federal Reserve rate cuts. Since lower interest rates reduce the opportunity cost of holding non‐yielding assets, gold benefited from this dovish shift.
At the same time, hopes that the US government shutdown could soon end—and signs of easing US–China trade tensions—weighed on gold’s safe‐haven appeal. On Monday, senators will vote on a funding agreement that would bring an end to the longest federal shutdown in US history. Meanwhile, China has signaled a temporary suspension of export curbs on key “dual-use” materials destined for the US.
Key US releases this week include October’s Consumer Price Index on Thursday (market forecasts: +0.2% month-on-month headline; +0.3% core) and October retail‐sales data on Friday.
Daily Digest – Market Movers
- The Senate adjourned until 11 a.m. Monday, when lawmakers will resume debate on a funding package to reopen federal agencies. House Democratic leaders say further votes are planned later this week, with 36 hours’ notice required.
- Bloomberg reports a bipartisan group of Senate Democrats has agreed to back a short-term spending deal that restores back pay for furloughed workers and funds some departments through January 30, while others receive full-year budgets.
- China’s Ministry of Commerce announced a temporary lift on export bans for certain “dual-use” materials—gallium, germanium, antimony and super-hard materials—to the US, effective immediately through November 27, 2026. This follows Friday’s decision to ease controls on some rare-earth metals and battery components.
- The University of Michigan’s consumer‐sentiment index fell to 50.3 in November—the lowest since June 2022—down from 53.6 in October and below the 53.2 consensus.
- According to the CME FedWatch tool, markets now assign roughly a 66% probability to a 25-basis-point Fed rate cut in December.
Technical Outlook – Bullish Bias Above 100-Day EMA
Gold remains in positive territory as it trades above its 100-day exponential moving average, with the 14-day RSI holding above mid-range near 55. A sustained break above the October 22 peak of $4,161 could open the way toward the $4,200 psychological mark, followed by the upper Bollinger Band around $4,325. Conversely, a slide below $4,000 might prompt a retest of the lower Bollinger Band near $3,835 and support at the 100-day EMA around $3,705.
