Gold market to focus on State of the union, FOMC, Jobs report

New York (Jan 30)  The State of the Union speech, a meeting of the Federal Open Market Committee and monthly jobs report are all key events in the U.S. that could influence the dollar and gold this week, said  Hussein Sayed, chief market strategist at FXTM.

 Trump is scheduled to deliver his first State of the Union address to Congress on Tuesday. Although he is highly likely to declare a victory over the tax overhaul, and how his actions boosted the American economy and stock returns, investors will be focused on any details surrounding the infrastructure bill, trade tensions, and border wall funding, Sayed added.

 Meanwhile, the analyst says the FOMC is expected to leave monetary policy unchanged when it announces the rate decision on Wednesday. Given this is the last meeting chaired by Janet Yellen, I don’t expect much out of it, Sayed noted.

 However, any tweaks in the statement may be slightly hawkish since inflation expectations have risen to its highest levels since 2014, the analyst noted.

 The jobs report on Friday is always one of the biggest news events of any month for financial markets. After a disappointing figure in December, markets are anticipating 175,000 nonfarm payrolls have been added in January.

 Moreover, since the return of inflation is becoming a hot topic, wage growth will be under the traders’ microscope once again. This is where we might see a surprise, driven by increased bonuses following the tax reforms, Sayed added.

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