Renewed trade war fears are respiration life into the gold market, in accordance to Phil Streible, senior market analyst at RJO Futures, who additionally pointed to rising investor fears over the opportunity of a price minimize.
“Potentially down the road, if equities slow down, and if the global economy slows down enough, you might see the Fed cut rates, that’s what’s breathing life right now into that gold market,” Streible advised Kitco News.
Gold prices jumped on the information of China’s tariff retaliation towards the US, retaking the $1,300 key stage. The yellow steel, which has been buying and selling nicely beneath its key psychological stage for the previous couple of weeks, reacted as a protected haven asset on Monday, gaining one p.c and hitting $1,303.26, which is its highest in over a month. Gold steadied on Tuesday, buying and selling at $1297.60 an oz as of 9:12 GMT.
Gold’s turnaround got here whereas different metals, together with silver, palladium and platinum reacted with a downward transfer. Global inventory markets and oil have additionally nosedived.
Experts say gold will proceed to see a safe-haven demand, with prices overdue for a rebound. According to Orchid Research, gold prices have been below stress in April and the tide is about to flip in May due to the dovish Federal Reserve and a decrease US greenback.
Chief market analyst at Insignia Consultants, Chintan Karnani, additionally says that “uncertainty over the real impact on [the] US economy and Chinese economy is driving gold prices higher.” He advised MarketWatch that the general pattern for gold is “bullish” so long as the dear steel trades over the $1,292-$1,294 zone.