As of early Wednesday trading, the GBP/USD currency pair was showing signs of weakness below the key 1.3350 psychological barrier. That led to a small drop, which wiped away much of its recent weekly increases. Traders are anxiously awaiting major policy decisions from the US Federal Reserve. This excitement is increasingly fueling the demand for the US Dollar.
During the morning trading session GBP/USD recorded modest declines, further highlighting the concern that remains in the currency market. The duo is moving lower because the US Dollar is in great demand. Wall Street investors are getting ready, if not counting on, major changes in the Federal Reserve’s monetary policy.
“GBP/USD stays pressured near 1.3350 amid US Dollar demand ahead of Fed” – www.fxstreet.com
On the other hand, the gold market experienced ferocious selling pressure, plunging back down from two-week highs of $3,435. This correction comes on the heels of a positive market mood due to US-China trade talk optimism, which has helped to further fuel a changing market dynamic. Whether that’s the case or not, you can see why investors are cashing in on their gains ahead of the Federal Reserve’s announcement on its policy. Consequently, gold prices have plummeted.
“Gold corrects from two-week highs, Fed decision eyed” – www.fxstreet.com
A strong US Dollar and the associated profit taking activity is leading gold prices lower. This has produced a very negative backdrop for the precious metal. Traders will be following the next step in US-China relations very closely. They expect these adjustments to keep influencing market sentiments and exert pressure on gold prices with volatility.