Gold futures fell slightly on Monday (July 22), with the settlement price of the August contract slightly below the important threshold of $2400 per ounce. On Tuesday in the Asian market, the main COMEX gold futures contract is currently trading around $2398.6 per ounce.

US President Biden unexpectedly announced his withdrawal from the presidential race, and market participants are analyzing it. The initial reaction of the market was relatively mild, with gold prices hitting a daily high at one point, then falling back to $2385.20, and then slightly recovering.

Jeffrey Christian, Managing Partner of CPM Group, pointed out, "We see the gold market calm today because they are waiting to see what the changes in Democratic candidate qualifications mean for the election, for the United States, and even for the whole world

StoneX analyst Rhona O Connell commented on the potential long-term impact, stating that due to inflationary pressures and geopolitical tensions, Trump's election as president may be more favorable for gold. But she emphasized that it is too early to take a strategic stance at this stage.

People's attention is now turning to the important economic report scheduled to be released later this week, with the release of the US Q2 GDP data on Thursday and the PCE report on Friday. The PCE report is particularly important as it provides the latest inflation data to Federal Reserve officials prior to the Federal Open Market Committee (FOMC) meeting on July 31st.

According to MarketWatch data, the market generally estimates that the annual inflation growth rate last month was 2.5%, lower than May's 2.6%. This data may strengthen people's expectations that the Federal Reserve will maintain the current benchmark interest rate at the upcoming meeting, with only a 2.6% chance of a rate cut.

Looking ahead to September, the possibility of interest rate cuts remains high. The Chicago Mercantile Exchange's (CME) Federal Reserve Watch tool shows a 91.2% chance of a 25 basis point rate cut, a 5.8% chance of keeping rates unchanged, and a 2.4% chance of a 50 basis point rate cut.

While traders await these key economic indicators, it is expected that gold prices will remain sensitive to changes in monetary policy expectations and political developments. Gold continues to be seen as a safe haven asset, especially during periods of economic uncertainty and political transition.

New York Gold Continuous Daily Chart