Gold Slips After FOMC Meeting Minutes
The gold () price fell by 0.4% on Wednesday after the Federal Reserve’s (Fed) May release. The report highlighted policymakers’ growing concerns about persistent inflationary pressures and emerging weaknesses in the labour market.
At its May meeting, the Fed held interest rates steady for the third consecutive time. The Fed reaffirmed its data-dependent approach amid growing economic fragility. While acknowledging the continued resilience of certain economic indicators, officials also noted a downgrade in growth projections and an elevated risk of recession.
Escalating trade tensions and the potential impact of proposed tariffs amplified concerns, heightening economic uncertainty. The Fed’s tone reflected a more cautious outlook, signalling that downside risks to the economy are becoming harder to ignore. Fed officials, including New York Fed President John Williams, emphasised the importance of responding decisively if deviates from the central bank’s 2% target. This signals a readiness to proactively adjust monetary policy to maintain price stability, even as broader economic conditions grow more complex.
XAU/USD continued to fall during Asian and early European trading sessions. Today, U.S. will come out at 12:30 p.m. UTC. The data may offer insight into U.S. labour market conditions and shape expectations. Key levels to watch for XAU/USD are support at $3,245 and resistance at $3,285.
Euro Slips After U.S. Court Blocks Trump’s Trade Tariffs
The euro () lost 0.32% on Thursday, for a third consecutive session following a significant legal setback for the Trump administration..
The decline followed a significant legal setback for U.S. President Donald Trump’s administration. A federal court concluded that Trump’s imposition of reciprocal tariffs exceeded his executive authority, ruling the tariffs ’unlawful to all’, not just the five plaintiffs in the case. The U.S. Court of International Trade ordered the immediate removal and permanent suspension of these tariffs, a decision that could have a wide range of implications for trade policy and market sentiment. The Trump administration will likely appeal the decision, but there’s now a new layer of uncertainty in the market, which investors must factor into their risk assessments.
At the same time, market participants are closely watching developments in the U.S. Senate. President Trump’s comprehensive tax and spending package faces intense scrutiny and is expected to undergo major revisions. On the monetary policy front, the latest FOMC Meeting Minutes revealed a more cautious tone among Federal Reserve (Fed) officials. The Committee emphasised a wait-and-see approach as it evaluated the economic impact of recent fiscal measures and ongoing trade disputes. Policymakers highlighted growing concerns about persistent inflation and a potential rise in unemployment—suggesting the Fed must carefully balance its dual mandate amid growing volatility.
EUR/USD continued to decline during Asian and early European trading sessions. Today, the market focuses on two U.S. macroeconomic reports at 12:30 p.m. UTC: and Jobless Claims data. Stronger-than-expected figures could delay rate cuts and push EUR/USD below 1.11800. Conversely, worse-than-expected results weigh on the and lift EUR/USD above 1.13000.
Weakening Safe-Haven Demand Weighs on JPY
Japanese yen () rose for a third consecutive session on Wednesday, gaining 0.3%.
The weakening safe-haven demand amid easing concerns over tariff-related risks contributed to a broader risk-on sentiment across global markets. This shift pressured the Japanese yen (JPY), which typically strengthens during periods of geopolitical or economic unease.
Meanwhile, Bank of Japan (BoJ) Governor Kazuo Ueda voiced concern over the recent rise in ultra-long-term Japanese government bond yields. He highlighted the importance of monitoring potential spillover into shorter-dated debt. His remarks underscore the BoJ’s increasing vigilance over financial stability risks as global interest rate dynamics evolve. While Ueda reiterated the central bank’s commitment to reach the inflation target, his remarks signal a readiness to adjust policy if yield volatility begins to threaten market or economic stability.
The Japanese yen weakened towards 146.000—a two-week low—during Asian and early European trading sessions. Today’s U.S. Jobless Claims data, due at 12:30 p.m. UTC, may trigger some volatility. For USD/JPY, key levels to watch are resistance at 146.300 and support at 145.000.