Market analysis: Powell's dovish remarks and the Federal Reserve's dovish response mechanism helped gold rise

Investinglive analyst Giuseppe Dellamotta said that recently, Federal Reserve Chairperson Powell made more dovish than expected remarks at the FOMC press conference, providing support for gold prices. He played down inflation risks and emphasized the weakness of the labor market, suggesting that the Federal Reserve is more tolerant of higher inflation than labor market weakness. This week's focus is on the US non-farm payrolls report and the Consumer Price Index (CPI) report. Currently, the market expects the Federal Reserve to cut interest rates by 57 basis points by the end of 2026. If the US economic data is strong, especially on the labor market, we may see the market make a hawkish adjustment to interest rate expectations and cause gold prices to fall. On the other hand, the weak data should further support precious metals prices as the market will bet on a rate cut ahead of time. From a broader perspective, real yields are likely to continue falling due to the Fed's dovish response mechanism, so gold prices should maintain their upward trend. But in the short term, further hawkish adjustments in interest rate expectations could weigh on the market.