report should outperform consensus on Friday. Additionally, Federal Reserve policymakers may now consider a continuation of the rate-tightening cycle at its September policy meeting.Index backed by a cautious market mood due to the Fitch downgrade also builds pressure on the Gold price. Apart from that, weak Gold demand reported by the World Gold Council is consistently building pressure on the Gold price. Meanwhile, investors await ISM Services PMI data for further guidance.
Concerning the US wage index, ADP’s Richardson said that annual wages grew at their slowest pace of 6.2% since November 2021. For job changers, pay growth slowed to 10.2%. Before the US NFP event, Services PMI data will be in focus, which will be published at 14:00 GMT. Unlike the contracting Manufacturing PMI, the service sector has consistently been in an expansionary phase, but analysts expect the July Services PMI to arrive lower at 53.0, below June’s reading of 53.9.
The US Dollar Index is approaching the crucial resistance of 103.00 as the market mood is quite cautious after Fitch downgraded the US government due to fiscal spending and governance issues. Gold price is consistently facing pressure this week due to weak Gold demand reported by the World Gold Council . The agency reported a 2% YoY decline in purchases by global central banks due to higher interest rates and a costly gold price.Chicago Fed Bank President Austan Goolsbee favors further policy tightening despite easing inflationary pressures. Atlanta Fed Bank President Raphael Bostic thinks an interest rate hike in September is no longer required.
The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing . QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system.