Gold prices remained steady, holding above $2,900 on Friday, as market participants keenly awaited the release of the US Non-Farm Payroll (NFP) data. The anticipation of this key piece of employment information has kept traders on their toes, while other economic factors, such as Germany's recent fiscal policy shift, have started to ripple across the markets.
Germany has begun to loosen its fiscal policies, a significant pivot from Europe's traditional approach characterized by slow growth and fiscal austerity. This shift could have extensive implications for the region's economic landscape. The move is seen as an effort to bolster economic activity and reduce reliance on monetary policy alone. As Germany opens its purse strings, investors are closely watching for potential economic impacts across the Eurozone.
In foreign exchange markets, the EUR/USD pair has gained momentum, trading at its highest level since early November, exceeding 1.0850 on Friday. The pair's upward trajectory is fueled by a combination of factors, including retreating US Treasury bond yields, which have placed additional bearish pressure on the US dollar. Meanwhile, expectations for further interest rate cuts by the Federal Reserve have helped cap losses for the XAU/USD pair.
Market participants remain focused on the upcoming February employment data from the US, which is poised to provide insights into the health of the labor market and influence future policy decisions by the Federal Reserve. As the USD continues to grapple with bearish sentiment, traders are keeping a close eye on the developments in both Europe and the US.
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