Daily Digest Market Movers: Gold price capitalizes on neutral commentaries from Fed speakers
New York Fed Bank President John Williams said there is no urgency for an interest-rate increase this month as inflation is falling and the economy is better balanced. However, Williams kept options open to keep interest rates higher for longer. Unit Labor Costs in the April-June quarter jumped to 2.2% against expectations and a Q1 reading of 1.6%. Decent wage growth defies signs of cooling inflation as it could strengthen the consumer spending momentum.
Meanwhile, the US Dollar Index remains below the immediate resistance of 105.00 as investors shift focus to US inflation data for August, which will be published next week. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar as it makes the US a more attractive place for international investors to park their money.