AXMIN Inc (TSXV: AXM)
AXMIN Inc. (TSXV:AXM) is a Canadian-based exploration and development company with a strong focus on central and West Africa.
Gold price extended the downward momentum on Wednesday as strong US economic data pushed back expectations that the central bank could cut interest rates as early as March. Combined with hawkish statements from a Federal Reserve official that pushed up the dollar and Treasury yields, gold prices fell to their lowest in nearly a month.
The spot gold price fell 1.1 per cent to $2004.78 an ounce as of 12:00 p.m. ET, hitting its lowest point since 2024. The precious metal opened the New Year near $2,065 an ounce. Futures gold prices also fell 1.1 per cent to $2007.50 an ounce.
Bob Haberkorn, senior market strategist at RJO Futures, noted Wednesday that the market’s doubts about whether the Federal Reserve will be able to cut interest rates sooner rather than later are weighing on gold prices. In the case of a stronger dollar and a rate cut that will take longer, it will be difficult for gold to maintain its upward trend.
According to the CME Fedwatch tool, traders see 57% odds for a 25 basis points (bps) interest rate cut in March, down from 70% at the start of the week.
However, analysts believe that geopolitical risks will continue to provide support for the price of gold, keeping it around $2,000.
Data released on Wednesday showed that U.S. retail sales rose 0.6 per cent in December from a year earlier, compared with the market’s general expectation of a 0.4 per cent increase and the previous 0.3 per cent. Analysts pointed out that retail sales data in 2023, a strong finish indicates that rising wages and inflation gradually cooling is boosting purchasing power, the U.S. consumer is expected to continue to drive economic growth in 2024, or to help the U.S. economy to achieve a “soft landing”.
Traders will pay close attention to Thursday’s release of U.S. new housing starts, building permits, weekly initial jobless claims and the Philadelphia Federal Reserve manufacturing index. These data may bring more clear direction to the gold price.
