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News source: FXStreet

Aug 20, 05:15 HKT

RBNZ expected to resume interest rate easing path

The Reserve Bank of New Zealand is set to lower the key interest rate to 3% on Wednesday.
The focus will be on the RBNZ’s OCR projection and Governor Hawkesby’s comments.
The New Zealand Dollar braces for intense volatility on the RBNZ policy announcements.

The Reserve Bank of New Zealand (RBNZ) is widely expected to lower the Official Cash Rate (OCR) from 3.25% to 3% when the board members conclude the August monetary policy meeting on Wednesday.

The decision will be announced at 02:00 GMT, accompanied by the Monetary Policy Statement (MPS). RBNZ Governor Christian Hawkesby’s press conference will follow at 03:00 GMT.

The New Zealand Dollar (NZD) remains exposed to big moves in immediate reaction to the central bank’s policy announcements.

What to expect from the RBNZ interest rate decision?

The RBNZ is set to resume its easing cycle this week, after having paused a series of six consecutive interest rate cuts in the July meeting.

Such a move would come as no surprise, especially after the RBNZ July Monetary Policy Review (MPR) said, “Committee expects to lower the official cash rate further, broadly consistent with the projection outlined in May.”

Back then, the MPR noted that the future path of the official cash rate would depend on additional data regarding the pace of New Zealand's economic recovery, the persistence of inflation, and the impacts of tariffs. Since then, the Consumer Price Index (CPI) rose 0.5% in the second quarter from the prior quarter and was up an annual 2.7%, Statistics New Zealand said. Both figures were a tad slower than the forecasts.

However, the RBNZ’s Sectoral Factor Model Inflation gauge fell from 2.9% to 2.8% YoY for the second quarter.

New Zealand’s Unemployment Rate climbed to 5.2% in the June 2025 quarter, up from 5.1% in the previous quarter, while other details of the jobs report showed a 0.1% QoQ decline in hiring as expected.

Weakening inflationary pressures and labor market conditions justify the upcoming rate cut, but the main focus will be on whether the central bank keeps the door open for further rate cuts amid signs of a pick-up in forward-looking measures of activity.

With a rate cut fully baked, markets are not expecting any big changes to the RBNZ’s inflation and OCR forecasts, compared with the May projections.

Analysts at TD Securities said: “We are not expecting the Bank to make a strong case for taking the OCR below 3% but advocate a data-dependent easing bias. We stick to a 3% terminal rate forecast but acknowledge the risks are skewed to the downside.”

How will the RBNZ interest rate decision impact the New Zealand Dollar?

The NZD/USD pair is on the road to recovery from weekly troughs in the lead-up to the RBNZ showdown.

If the central bank hints that it is nearing the end of the rate-cutting cycle amid an improving economic outlook, it could boost the NZD, providing extra legs to the recent upswing.

However, any downward revisions to the inflation and/or OCR forecasts could bode ill for the Kiwi Dollar, dragging the pair back toward the monthly lows.

Dhwani Mehta, Asian Session Lead Analyst at FXStreet, offers a brief technical outlook for NZD/USD and explains:

“From a near-term technical perspective, risks remain skewed to the downside for the Kiwi pair so long as the 14-day Relative Strength Index (RSI) stays below the midline. Adding credence to the bearish outlook, the 21-day Simple Moving Average (SMA) is on the verge of crossing below the 100-day SMA, teasing a potential Bear Cross.”

“Buyers need acceptance above the 21-day SMA and the 100-day SMA confluence near 0.5950 to negate the bearish bias in the immediate term. Further up, the 0.6000 round level could be tested after the NZD/USD pair surpasses the 50-day SMA at 0.5988. The 0.6050 psychological barrier will be next on tap. Conversely, a sustained break below the static support near 0.5900 will pave the way for a steep drop toward the August 5 low of 0.5881, below which the key 200-day SMA support at 0.5833 will be exposed,” Dhwani adds.

RBNZ FAQs

What is the Reserve Bank of New Zealand?

The Reserve Bank of New Zealand (RBNZ) is the country’s central bank. Its economic objectives are achieving and maintaining price stability – achieved when inflation, measured by the Consumer Price Index (CPI), falls within the band of between 1% and 3% – and supporting maximum sustainable employment.

How does the Reserve Bank of New Zealand’s monetary policy influence the New Zealand Dollar?

The Reserve Bank of New Zealand’s (RBNZ) Monetary Policy Committee (MPC) decides the appropriate level of the Official Cash Rate (OCR) according to its objectives. When inflation is above target, the bank will attempt to tame it by raising its key OCR, making it more expensive for households and businesses to borrow money and thus cooling the economy. Higher interest rates are generally positive for the New Zealand Dollar (NZD) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken NZD.

Why does the Reserve Bank of New Zealand care about employment?

Employment is important for the Reserve Bank of New Zealand (RBNZ) because a tight labor market can fuel inflation. The RBNZ’s goal of “maximum sustainable employment” is defined as the highest use of labor resources that can be sustained over time without creating an acceleration in inflation. “When employment is at its maximum sustainable level, there will be low and stable inflation. However, if employment is above the maximum sustainable level for too long, it will eventually cause prices to rise more and more quickly, requiring the MPC to raise interest rates to keep inflation under control,” the bank says.

What is Quantitative Easing (QE)?

In extreme situations, the Reserve Bank of New Zealand (RBNZ) can enact a monetary policy tool called Quantitative Easing. QE is the process by which the RBNZ prints local currency and uses it to buy assets – usually government or corporate bonds – from banks and other financial institutions with the aim to increase the domestic money supply and spur economic activity. QE usually results in a weaker New Zealand Dollar (NZD). QE is a last resort when simply lowering interest rates is unlikely to achieve the objectives of the central bank. The RBNZ used it during the Covid-19 pandemic.

Aug 20, 01:42 HKT

Dow Jones Industrial Average grapples with fading AI rally

The Dow Jones backslid again on Tuesday as equities waffle on tech outlook.
Key earnings reports point to a cooldown in US consumer habits.
Central bank policy statements and PMI survey results loom large over the rest of the week.

The Dow Jones Industrial Average (DJIA) flubbed an early rise on Tuesday, jumping higher before backsliding through the rest of the day, erasing the early morning gains. Investors are reconsidering their overly bullish positions heading into the midweek, trimming their exposure to the ongoing AI-fueled tech rally and hesitating after mega-sized home building supplier Home Depot (HD) missed earnings growth expectations.

The Dow Jones is still grappling with the 45,000 handle as major names on the Dow take a knee on Tuesday, balancing out gains made on the other side of the stock index. 45,277 remains the level to beat for buyers to push the Dow Jones back into fresh record highs, but the major equity index could be poised for a further pullback with price action testing well north of the 50-day Exponential Moving Average (EMA) near 43,875.

Key building supplier gains ground, but red flags are surfacing

Home building supplier Home Depot showed ongoing earnings growth in the second quarter, with revenue reaching $45.38B for the single quarter, and up around 5% YoY. However, Home Depot earnings still missed analyst expectations for the second quarter in a row. Home Depot stock gained firm ground on Tuesday, up around 3% on the day at the time of writing, but missed expectations are giving investors cause for pause on their assumptions about ongoing earnings growth. Consumers are beginning to revamp their home building and renovation habits, pivoting away from major projects and opting for smaller, cheaper projects, leaving big-ticket supplies and items on the shelves in favor of an increase in small-scale home investments and appliances.

Just as recession-wary consumers are switching to investing in appliances and cheaper home improvements rather than investing in large-scale renovations and upgrades, early tariff effects are already leaking through supply chains. Supply chain length and complexity, rather than earth-shattering bartering power, is sparing US consumers from the brunt of tariff-led price changes. Prices are rising faster and sooner in categories with shorter, more efficient supply chains, specifically in items such as appliances and small-scale home improvements. With consumers pivoting away from large home improvements in favor of medium-ticket items, the door could be closing on a major economic engine of US consumption.

Tech rally takes a rare double-glance

The AI tech craze caught a rare moment of clarity on Tuesday as the landscape continues to shift beneath the feet of ChatGPT-prompting navel-gazers. Tech stocks saw unexpected declines on the day, with AI flagship Nvidia (NVDA) backsliding over 3%. Facebook parent company Meta (META) announced it would be “restructuring” its entire AI division into smaller core groups with more defined design targets. This will pull a large portion of Meta’s AI development focus away from aiming for hypothetically profitable AI product offerings and refocus on ambiguously profitable “superintelligence” projects. Meta has also announced its departure from using strictly in-house tech to further its AI research goals and will now be accessing third-party technology from other AI companies. These are ostensibly the same AI research farms that Meta has spent the past two years hollowing out through billion-dollar talent-poaching schemes.

Dow Jones 5-minute chart

Dow Jones daily chart

Dow Jones FAQs

What is the Dow Jones?

The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500.

What factors impact the Dow Jones Industrial Average?

Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions.

What is Dow Theory?

Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow’s theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits.

How can I trade the DJIA?

There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.

Aug 20, 05:06 HKT

Canadian Dollar weakens after Canadian CPI eases faster than expected

The Canadian Dollar lost further ground against the US Dollar on Tuesday.
Canadian CPI inflation eased more than expected in July, knocking back the Loonie.
Despite easing inflation pressures, headline inflation metrics are still far above BoC targets.

The Canadian Dollar (CAD) shed further weight on Tuesday, declining against the US Dollar (USD) after Canadian Consumer Price Index (CPI) inflation figures showed a slight easing in headline figures. Despite cooling headline figures, expectations of easing price pressures for consumers remain subdued as still-rising costs for everyday items get offset by fuel price reductions after the federal government axed key carbon taxes.

Rate market bets on the next Bank of Canada (BoC) interest rate cut remain largely unchanged, with median expectations forecasting that the Canadian central bank will continue to stand pat on interest rates until late January. Mixed inflation data bodes poorly for a clear path forward for the BoC, and when coupled with lagging employment numbers through the second quarter, makes it difficult for the BoC to justify dropping rates any further.

Daily digest market movers: Canadian Dollar retreats on complicated CPI inflation print

The Canadian Dollar fell nearly one-half of one percent against the US Dollar on Tuesday.
USD/CAD was driven to its highest bids in over two weeks following Canadian CPI inflation data.
Common CPI held steady at 2.6% YoY, while the BoC’s Trimmed Mean CPI held steady at 3.0%.
Headline CPI ticked higher to 0.3% MoM, also as expected.
Despite a slight easing overall inflation pressures, the BoC still lacks room to make interest rate cuts thanks to declining hiring figures in the second quarter.
Economists are equally divided on whether or not the Bank of Canada will be able to justify a rate trim in time for its next rate call in September.

USD/CAD price forecast

Tuesday’s bearish Loonie flows pushed USD/CAD back into multi-week highs, and the pair is now poised to close higher for the second week in a row if momentum holds through the end of the week. USD/CAD is inching back toward the 200-day Exponential Moving Average (EMA) near 1.3880, which should provide significant technical resistance for bidders to contend with.

USD/CAD daily chart

Canadian Dollar FAQs

What key factors drive the Canadian Dollar?

The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar.

How do the decisions of the Bank of Canada impact the Canadian Dollar?

The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive.

How does the price of Oil impact the Canadian Dollar?

The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD.

How does inflation data impact the value of the Canadian Dollar?

While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar.

How does economic data influence the value of the Canadian Dollar?

Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.

Aug 20, 02:42 HKT

AUD/USD Price Forecast: Australian Dollar slips to two-week low, eyes break below 0.6450

AUD/USD drops over 0.5% to near 0.6455, its lowest level in two weeks.
The US Dollar Index (DXY) holds firm near a four-day high around 98.22.
The Greenback is supported by cautious sentiment ahead of Fed minutes and Jackson Hole Symposium.

The Australian Dollar (AUD) weakens against the US Dollar (USD) on Tuesday, with AUD/USD slipping to its lowest level in two weeks. The pullback comes as the Greenback regains strength ahead of key US macro events, including the release of the Federal Reserve’s (Fed) July meeting minutes on Wednesday and Friday’s Jackson Hole Symposium, prompting cautious repositioning across currency markets.

At the time of writing, the AUD/USD pair is trading near 0.6453, down over 0.5% on the day. Meanwhile, the US Dollar Index (DXY), which measures the Greenback’s performance against a basket of six major currencies, is holding firm near a four-day high around 98.22, underpinned by cautious market sentiment and broad-based Dollar strength.

From a technical perspective, AUD/USD is currently testing support near the 0.6450 mark on the 4-hour chart. The pair has been drifting lower since briefly peaking above 0.6550 on August 14, forming a sequence of lower highs and lower lows, indicative of a short-term bearish trend.

A sustained break below 0.6450 would expose the next immediate support at 0.6420, the monthly low from August 1. A failure to hold above this zone could trigger a deeper pullback toward the June low at 0.6385

On the upside, initial resistance is seen near the 21-period Simple Moving Average, currently at 0.6498. This coincides with recent intraday swing highs and could cap any recovery attempts. A break above that would bring the 50-period SMA into focus. However, the 0.6550 level remains the key to shift the broader bias back to neutral, as it marks the August swing high and a strong prior rejection point.

Momentum indicators on the 4-hour chart paint a bearish picture for AUD/USD. The Relative Strength Index (RSI) has dropped to 28.5, slipping firmly into oversold territory. While this suggests selling pressure is elevated, it also raises the risk of a temporary bounce or consolidation, especially if the pair holds above the 0.6450-0.6420 support area.

However, given the prevailing trend of lower highs and lower lows, the oversold reading currently supports continuation rather than reversal. The Moving Average Convergence Divergence (MACD) indicator has shown a fresh bearish crossover, with the histogram turning negative, pointing to strengthening downside momentum, albeit still modest while near the zero line. Meanwhile, the Average Directional Index (ADX) stands at 19.6, indicating that although the trend is not yet strongly directional, bearish strength is beginning to build. A rise above 20 in the coming sessions could further validate the downside momentum.

Economic Indicator

FOMC Minutes

FOMC stands for The Federal Open Market Committee that organizes 8 meetings in a year and reviews economic and financial conditions, determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. FOMC Minutes are released by the Board of Governors of the Federal Reserve and are a clear guide to the future US interest rate policy.

Why it matters to traders?

Minutes of the Federal Open Market Committee (FOMC) is usually published three weeks after the day of the policy decision. Investors look for clues regarding the policy outlook in this publication alongside the vote split. A bullish tone is likely to provide a boost to the greenback while a dovish stance is seen as USD-negative. It needs to be noted that the market reaction to FOMC Minutes could be delayed as news outlets don’t have access to the publication before the release, unlike the FOMC’s Policy Statement.

Aug 20, 02:35 HKT

Forex Today: The FOMC Minutes and UK inflation in the spotlight

The US Dollar (USD) had a positive day on Tuesday, as traders remained cautious ahead of the release of the FOMC Minutes on Wednesday and the pivotal Jackson Hole Symposium later this week. Furthermore, geopolitics has returned to the forefront of price action drivers.

Here's what to watch on Wednesday, August 20:

The US Dollar Index (DXY) clocked acceptable gains around 98.30 in a context of a generalised decline in US yields. The publication of the FOMC Minutes will be the salient event, seconded by the weekly MBA Mortgage Applications and the weekly report on US crude oil supplies by the EIA. In addition, the Fed’s Waller and Bostic are due to speak.

EUR/USD retreated modestly, adding to Monday’s downtick, always below the 1.1700 mark. The final Inflation Rate in the euro area will be released alongside the flash Q2 Labour Cost Index.

GBP/USD retreated to multi-day lows after breaching below the 1.3500 support. The critical Inflation Rate takes centre stage across the Channel.

USD/JPY faded Monday’s advance and revisited the mid-147.00s following earlier tops north of the 148.00 mark. Next in Japan will be the Balance of Trade results and Machinery Orders.

AUD/USD weakened further and reached three-week lows near the 0.6450 zone. The Consumer Inflation Expectations are due, seconded by the speeches from the RBA’s Connolly and McPhee.

Crude oil prices deepened their bearish leg, adding to Monday’s decline below the $62.00 mark per barrel of the American WTI as geopolitical tensions continued to mitigate.

Gold posted marked losses and slipped back to the $3,315 mark per troy ounce amid gains in the Greenback and declining US yields. Silver prices, in the same direction, dropped sharply to multi-day lows near the $37.00 mark peer ounce.

Aug 20, 02:34 HKT

Gold slumps on geopolitical developments, strong Dollar ahead of Powell’s speech

Gold tumbles as Trump, Zelenskiy and European leaders discuss possible negotiations with Russia.
Safe-haven demand eases as speculation of security guarantees for Kyiv sparks optimism over a potential end to the war.
Trader’s eye Fed minutes and Powell’s speech for clues on policy path as Bowman reiterates outlook for three rate cuts.

Gold price tumbles on Tuesday as the Greenback extends its minimal gains for the second straight day, while geopolitical developments suggest that a positive outcome of the US President Trump meeting with Putin, Zelenskiy and European leaders could put an end to the ongoing war. XAU/USD is trading at $3,317.

Rumors of a possible de-escalation of the Ukraine–Russia conflict weighed on Bullion prices, which usually benefit from global uncertainty. Last Friday, the meeting between US President Donald Trump and his Russian counterpart, Vladimir Putin, prepared the ground for a possible resolution.

Trump reunited with Ukraine’s President Volodymyr Zelenskiy and other European leaders on Monday to set the stage for a possible ceasefire and push for a trilateral meeting to begin negotiations between Kyiv and Moscow.

US President Trump said that “Putin, Zelenskiy must be flexible” and that there would be some security guarantees for Ukraine to prevent another Russian attack. However, he said that he would not allow Ukraine to join NATO and added that European countries would supply ground troops.

Aside from this, housing data in the US was mixed. Housing Starts in July crushed estimates, rising more than 5%, while Building Permits dropped. Meanwhile, Federal Reserve (Fed) Governor Michelle Bowman reiterated the posture of three cuts by the year’s end and emphasized that the central bank should focus more on the employment mandate.

Ahead of this week, traders are eyeing the latest Fed meeting minutes and the speech of Fed Chair Jerome Powell on Friday.

Daily digest market movers: Gold price tumbles on US Dollar strength

The US Dollar Index (DXY), which tracks the buck's performance against a basket of six currencies, is up 0.13% at 98.23.
The US 10-year Treasury note is yielding 4.30%, down by nearly three basis points (bps).
US Housing Starts rose 5.2% in July, climbing from 1.321 million to 1.428 million and beating expectations for a decline to 1.3 million. In contrast, Building Permits slipped during the same period, falling from 1.393 million to 1.354 million, signaling some softness ahead in residential construction activity.
Expectations that the Fed will reduce rates in September remain high, though traders priced out a 50-bps chance that emerged following the US Consumer Price Index (CPI) report. However, July’s PPI spooked investors, who had also bet that the central bank might keep rates unchanged.
Fed Interest Rate Probabilities show that traders had priced in an 85% chance of a quarter of a percentage rate cut at the September meeting, according to Prime Market Terminal data.

Technical outlook: Gold price slides towards $3,300 to turn neutral below $3,250

Gold price prints back-to-back bearish days, even though the overall trend in the daily chart is upwards. Nevertheless, since XAU/USD dropped below $3,320, the yellow metal seems poised to challenge the 100-day Simple Moving Average (SMA) at $3,301 in the near term.

The Relative Strength Index (RSI) turned bearish after it crossed below its 50-neutral line, but from a price action perspective, Gold needs to clear the June 30 low of $3,246 before turning neutral ahead of testing lower prices.

For a bullish resumption, traders need to reclaim the confluence of the 20- and 50-day Simple Moving Averages (SMAs) between $3,347/48. A breach of those levels clears the path to test $3,400. Overhead lie further key resistance levels, like the June 16 high at $3,452 and ultimately the all-time peak of $3,500.

Gold FAQs

Why do people invest in Gold?

Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Who buys the most Gold?

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

How is Gold correlated with other assets?

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

What does the price of Gold depend on?

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

Aug 20, 01:45 HKT

New Zealand Dollar dips with RBNZ cut in focus, Fed minutes on deck

NZD/USD hovers near 0.5900, down 0.40% intraday as the Greenback regains footing ahead of key macro events.
The US Dollar Index (DXY) extends modest gains toward 98.20, though upside remains limited amid firm expectations for a September Fed rate cut.
Markets' attention now turns to Wednesday’s RBNZ meeting, with a 25 bps rate cut to 3.00% expected.

The New Zealand Dollar (NZD) weakens against the US Dollar (USD) on Tuesday, as traders reposition ahead of key macro catalysts, including the release of the Federal Reserve's (Fed) July meeting minutes and the Jackson Hole Symposium later this week. The Greenback edges higher across the board amid cautious sentiment, adding pressure on the Kiwi ahead of Wednesday’s Reserve Bank of New Zealand (RBNZ) interest rate decision.

At the time of writing, NZD/USD is trading near 0.5900, matching its weakest level since August 6 and reflecting a drop of approximately 0.40% for the day. While the US Dollar Index (DXY) edges upward toward 98.20 during the American session, its upside appears capped as markets are heavily pricing in a nearly certain 25 bps rate cut by the Federal Reserve in the September meeting.

RBNZ expected to cut OCR to 3.00%

Investor focus now shifts squarely to the RBNZ’s policy meeting on Wednesday, where a 25 basis-point cut from 3.25% to 3.00% is widely expected. According to a Reuters poll conducted between August 11 and 14, 28 out of 30 economists forecast the central bank will cut the Official Cash Rate (OCR) from its current level. The probability of a rate cut now stands over 90%, reflecting a broad consensus that the RBNZ is ready to step back in to support the economy.

This would be the first cut since earlier this year, after the RBNZ paused in July to assess the impact of prior easing steps. However, recent macroeconomic developments have likely tilted the balance back toward more accommodative policy.

Unemployment rose to 5.2% in the second quarter, its highest level since 2021.
Employment declined by 0.1%, while the labour force participation rate dropped to 70.5%, the lowest in over three years.
Meanwhile, annual CPI inflation came in at 2.7% for the June quarter, comfortably within the RBNZ’s 1-3% target range.

Although global uncertainties persist, including trade friction and supply-side concerns tied to US tariffs, domestic inflation appears to be on a controlled trajectory. RBNZ Chief Economist Paul Conway recently acknowledged that trade policy disruptions could lower medium-term inflation, even as they threaten to suppress consumption and business investment.

What comes next? Market split on forward path

While Wednesday’s expected rate cut by the RBNZ appears to be a near-certainty, the medium-term trajectory for the interest rate cut path remains uncertain. Market analysts are divided in their outlooks. ASB Bank and Westpac Banking Corporation believe this week’s move will mark the final cut in the current monetary easing cycle. In contrast, the Bank of New Zealand (BNZ) anticipates one additional rate reduction, bringing the OCR down to 2.75% by the end of 2025. Meanwhile, both Australia and New Zealand Banking Group (ANZ) and Kiwibank forecast a more extended easing path, with the OCR potentially falling as low as 2.50% in 2026. The median market forecast points to one more 25 basis point cut in the first quarter of 2026.

Traders will closely watch the RBNZ’s Monetary Policy Statement and press conference on Wednesday for cues on the future rate trajectory. Later in the day, the release of the Federal Reserve’s July meeting minutes could offer fresh insight into the US policy outlook. Looking ahead, Friday’s Jackson Hole Symposium will take center stage, with Fed Chair Jerome Powell’s remarks likely to influence global rate expectations and broader market sentiment.

Aug 19, 20:03 HKT

Gold retreats from intraday high, trades heavy below $3,330

Gold edges lower on Tuesday, easing from an intraday high of $3,345 as increased risk appetite and a firmer US Dollar weigh on sentiment.
A stable US Dollar and slightly lower Treasury yields are offering mixed signals for Gold, limiting strong directional moves during the American session.
Technically, XAU/USD is trading below the $3,330 threshold, reinforcing a bearish bias and paving the way for further downside toward $3,300.

Gold (XAU/USD) edges lower during the American session on Tuesday, pressured by a firmer US Dollar and improved risk sentiment. The metal is trading near $3,320, close to the 12-day low marked during early Asian trade. Earlier in the day, Gold had briefly rebounded from overnight weakness following Monday’s White House summit between US President Donald Trump, Ukrainian President Volodymyr Zelenskyy, and key European leaders. While the talks signaled diplomatic unity, the lack of a ceasefire continues to keep geopolitical uncertainty elevated, providing some underlying support to safe-haven flows.

A stronger US Dollar is capping Gold's recovery attempts, while slightly lower Treasury yields after three days of gains are offering only limited support. Looking ahead, focus shifts to Wednesday’s release of the FOMC meeting minutes and the upcoming Jackson Hole Symposium, both of which could shape expectations for the Federal Reserve’s next policy move. Markets are still pricing in a rate cut in September, and any dovish rhetoric could help revive demand for non-yielding assets like Gold.

While markets welcomed signs of diplomatic coordination, the Trump-Zelenskyy summit offered little in the way of immediate breakthroughs, keeping investors on edge. Leaders pledged continued military and economic support for Ukraine, with talks centering around a proposed “coalition of the willing” to oversee future defense arrangements. President Trump revealed he had already spoken with Russian President Vladimir Putin and signaled early preparations for a potential trilateral summit. “It would be two presidents, plus myself,” he noted, referring to a possible meeting with both Zelenskyy and Putin. Trump also emphasized that the United States would work closely with European partners to establish long-term security guarantees for Ukraine.

Market movers: Dollar, yields pull back as focus turns to Fed Minutes

The US Dollar Index (DXY), which measures the Greenback against a basket of six major currencies, is holding steady near 98.17 on Tuesday, after briefly rising to a four-day high of 98.32 during Asian trading hours.
US Treasury yields are easing slightly on Tuesday. The benchmark 10-year yield is currently at 4.312% and the 30-year at 4.913%, both retreating from two-week highs reached on Monday.
S&P Global Ratings reaffirmed the United States' long-term sovereign credit rating at AA+ with a stable outlook. The agency noted that recent increases in tariff revenue are helping to offset fiscal pressures caused by expanded government spending and earlier tax cuts. While fiscal challenges persist, the stable outlook reflects confidence in the US economy’s resilience.
UBS has increased its Gold price outlook, forecasting $3,600 per ounce (up from $3,500) by the end of March 2026, and now expects prices to reach $3,700 per ounce by June and September 2026. This upward revision is rooted in mounting US macroeconomic risks, accelerating de-dollarization, and robust demand from ETFs and central banks. The bank anticipates global Gold demand rising 3% to 4,760 metric tons in 2025, the highest level since 2011
Goldman Sachs also maintains a bullish long-term outlook on Gold, projecting prices could reach $3,700 by end‑2025 and $4,000 by mid‑2026, citing sustained demand from “conviction buyers” including central banks and long-term investors.
The latest US economic data offers a mixed macro signal but remains consistent with a moderating growth narrative enough to keep rate cut expectations alive, though not urgent. Retail Sales came in firm, pointing to resilient consumer demand, but a dip in consumer sentiment and rising long-term inflation expectations suggest households are becoming more cautious. Markets have responded by slightly paring back expectations for aggressive easing, yet a September rate cut remains the dominant base case.
According to the CME FedWatch Tool, markets are pricing in an 83% chance of a 25 basis point rate cut at the Federal Reserve’s September 17 meeting. However, a Reuters poll published on August 15 reveals a more cautious stance among economists. Out of 110 surveyed, 67 expect a quarter-point cut next month, up from 53% in July, while just one forecasts a 50 basis point move. The remaining 42 economists see the Fed holding steady. While over 60% of respondents expect one or two cuts in total this year, there was no consensus on where the federal funds rate will stand by the end of 2025.
Tuesday’s US economic calendar is relatively light, with Housing Starts being the only notable release. No major market-moving data is scheduled later in the day, though traders will keep an eye on remarks from Fed Vice Chair for Supervision of the Board of Governors Michelle Bowman for any fresh policy cues. Focus will turn to Wednesday’s release of the FOMC meeting minutes, which could provide further clarity on the Fed’s policy outlook.

Technical analysis: Gold consolidates in a narrow band, breakout hinges on $3,370

Gold (XAU/USD) is trading near $3,325 on Tuesday, slipping below the $3,330 support zone and testing its lowest level in nearly two weeks. While the metal had largely been confined to a horizontal range between $3,330 and $3,370 over the past week, the recent breakdown suggests growing downside pressure.

The failure to reclaim the 100-period Simple Moving Average (SMA) on the 4-hour chart, currently around $3,348, reinforces the bearish tilt.

At the same time, the 4-hour chart shows a falling wedge formation developing within this broader sideways range, a chart pattern that typically signals potential bullish breakout risk.

The Relative Strength Index (RSI) has slipped to 38, indicating building bearish momentum and reinforcing the downside bias in the near term.

A decisive break above $3,370 and wedge resistance could spark fresh upside momentum toward $3,400 psychological level. On the downside, a sustained move below $3,330 could expose the next support at $3,300, with further downside risk if that level gives way.