FX.co ★ FOMC Minutes Outlook at July Meeting

The precious metals market was in the red on Tuesday, with gold down $35 as the US dollar index surged to a 20-year high and markets focused on the minutes of the Federal Reserve meeting and the US jobs report.

Gold plummeted below $1,800 an ounce.

The US dollar index rose to 106.66, rising again to a 20-year high.

The US dollar also traded at 20-year highs against the euro. Investors are flocking to the US dollar as a safe-haven currency after the Federal Reserve embarked on a very aggressive tightening path to bring inflation under control.

All eyes are on the minutes of the FOMC meeting, where markets are looking for clues related to the upcoming rate hike and any new comments from Fed members about the recession. The minutes will be published on Wednesday.

The CME FedWatch tool shows an 85.6% chance of a 75 basis point rate hike at the July meeting and only a 14.4% chance of a 50 basis point hike.

Most likely, the US dollar will maintain its strength. The only thing that could change hawkish opinion is the worrying June jobs report due on Friday, or slowing inflation data.