Last week, Gold gained 2.5% to reach $1,855. This week, Gold’s direction is likely to be determined by today’s testimony by Fed Chair Powell and the US labour market data on Friday, strategists at Commerzbank report.

Interest rates are expected to peak at 5.5%

“According to the Fed Fund Futures, interest rates are expected to peak at 5.5%. Powell would have to adopt a very hawkish tone and labour market data would have to surprise significantly to the upside again for expectations to be ramped up any higher. In this scenario, Gold would come under pressure again – but otherwise, it looks as if it has completed its correction.”

“Interest rate expectations would need to fall again for prices to rise, yet neither Powell nor the labour market data are likely to send out any such signals.”