The appreciation of the US dollar triggered a pullback in gold prices, with investors locking in gains.

This week, the precious metals market experienced a noticeable net value correction, with gold prices facing dual pressures. On one hand, the US dollar performed strongly ahead of key economic data releases, remaining volatile near a two-week high; on the other hand, investors began to take profits from recent gains, and the combination of these forces suppressed market sentiment.

Gold and silver assets priced in USD have become more expensive for holders of other currencies, directly weakening international buying demand. Brian Lan, Managing Director of GoldSilver Central, pointed out that the rapid pace of precious metal price increases will inevitably lead to a profit-taking correction, which is a normal technical adjustment.

Economic Data Leading Market Expectations

Investors are currently focusing on the Federal Reserve’s interest rate cut prospects. The market consensus expects the Fed to initiate at least two rate cuts this year, with upcoming non-farm payroll data becoming a key observation point. Additionally, the JOLTS job openings report and ADP employment data released on Wednesday are also expected to influence market sentiment, as these indicators will directly impact investors’ judgments on the dollar’s trend.

Until economic data clarifies, the dollar remains strong, continuing to exert downward pressure on gold prices. While waiting for Friday’s non-farm payroll report, investors are also assessing the current value of precious metal allocations.

Market Outlook

The short-term correction in gold prices does not change the medium-term outlook but provides new entry opportunities. The key factors will be the subsequent economic data performance and the clarity of the Federal Reserve’s policy signals, which will determine the strength of the precious metals’ rebound.