Market Analysis: Powell's Dovish Remarks and the Fed's Dovish Response Mechanism Boost Gold's Rise

According to Jinshi Data, Investinglive analyst Giuseppe Dellamotta stated that recently, Federal Reserve Chairman Powell made more dovish comments than expected at the FOMC press conference, providing support for gold prices. He downplayed inflation risks and emphasized the weakness in the labor market, suggesting that the Fed's tolerance for higher inflation is greater than its tolerance for a weak labor market.

This week's focus is on the U.S. non-farm payroll report and the Consumer Price Index (CPI) report. Currently, the market expects the Fed to cut rates by 57 basis points by the end of 2026. If U.S. economic data is strong, particularly in the labor market, we may see a hawkish adjustment in market rate expectations, leading to a decline in gold prices.

On the other hand, weak data should further support precious metal prices, as the market will bet on rate cuts in advance. From a more macro perspective, due to the Fed's dovish reaction mechanism, real yields may continue to decline, so gold prices should maintain an upward trend. However, in the short term, further hawkish adjustments in rate expectations may put pressure on the market.