With the approach of December probability of the interest rate rise by the US Fed is increasing.

According to CME Group, now investors assess probability at the level of 62% in December.

Yesterday, President of Fed Cleveland Mrs Loretta Mester has said that minor increase in rate will be appropriate and it can take place at the next two meetings of the Central Bank scheduled for this year. This statement has serves as another proof that the rise can be raised soon.

This week a lot of the US macro-economic data is scheduled for release. According to Monday’s report by the Institute for Supply Management (ISM), PMI in the manufacturing sector rose to 51.5 in September against 49.4 in August. This is a very positive indicator, as the rise in the index above 50 shows activity growth in the important sector of the U.S. economy.

On Wednesday at 16:45 and 17:00 (GMT+3) PMI (business activity index) in the service sector for September from Markit Economics will be released. This index evaluates sales and employment and gives predictions for the development of the service sector. ISM PMI in the US service sector for September will be also known. It is expected that the index will rise to 53.0 in September against 51.4 in August.

Investors are also waiting for the US labor market data for September.

Is expected that the number of new jobs outside the US agricultural sector will increase by 18 000 up to 170 000 new jobs and unemployment rate will remain unchanged at the level of 4.9%.

of the U.S. economy, as well as maintaining a low unemployment rate (4.9 percent).If the macro data for the of new jobs outside agricultural sector of the U.S. economy, as well as maintaining a low).If the macro data for the US will continue to come up with positive indicators, the probability of a rate hike in the U.S. will increase substantially, and this is a negative signal for gold price.In an environment of rising US interest rates gold is losing its investment attractiveness, behind the dollar and safer assets such as government bonds.

If the US macro economic data will continue to be positive, probability of the rate hike in the USA will increase substantially, and this will have a negative impact on the price of gold.

At the same time, demand for gold is supported by the facts that most Central Banks of the world adheres to monetary easing policy and uncertainty in the global economy still prevails, partly due to Brexit.

The decline in the price of gold below $1300.00 per ounce is not expected.

XAU/USD: USD is number one in the market.  Fundamental analysis for 04.10.2016

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