The precious yellow metal volatility increased on Tuesday after comments from U.S. Treasury Secretary Janet Yellen saying U.S. interest rates may have to rise somewhat to keep the economy from overheating.
“It may be that interest rates will have to rise somewhat to make sure that our economy doesn’t overheat, even though the additional spending is relatively small relative to the size of the economy,” Yellen said in remarks webcast during The Atlantic’s Future Economy Summit.
But later in the day, Yellen was asked about the market reaction to the comments at a separate virtual conference said sees no inflation problem brewing, downplaying earlier comments.
She said a rise in interest rates “is not something that I am predicting or recommending”.
Janet Yellen, the first woman to head both the Federal Reserve and the Treasury Department, said no one respects the Fed’s independence more than she does.
Private payroll data will also be released Wednesday, with the forecast seen at 872,000 private jobs added in April, compared to the 517,000 in March.
These numbers come ahead of Friday’s closely watched jobs report from the U.S., which will provide insights into the state of recovery of the labour market.
The Non-Farm Employment Change forecast is seen for a rise of 975,000, with the previous release at 916,000, while the Unemployment Rate forecast at 5.7%, with the last release at 6.0%.
From the technical standpoint, the overnight’s surges are expected to encounter a bearish ambush upon any challenges towards $1,802-08.
The downside target holds to a trajectory of $1,746-48, with the immediate support at $1,760.