Gold price is trading positive since trading session began for the day supported by broad based dollar’s weakness which was influenced post Fed Chair Jerome Powell’s speech last night. Powell commented that Fed is likely to take a patient approach on rate hike plans as inflation in US is low and stable currently allowing certain level of flexibility for MPC members to operate in regards to policy tightening schedule. Dollar which was already weak in broad market this week owing to increased risk appetite suffered even further resulting in sharp sell-off and this has boosted demand for gold. Given ongoing political and economic issues across major global economies, there is always some level of demand for safe haven asset.
Crude Continues To Gain on Sino-U.S. Trade Talk Optimism
Gold which is viewed as #1 safe haven asset against inflationary issues in any market is experiencing heavy demand since last month now that US Greenback has lost its safe haven demand. Given decline in USD in which the yellow metal is priced in, the asset is experiencing increased demand from across the globe owing to cheap exchange rates. Regardless of increased risk on trading environment, yellow metal has received steady demand in spot market across the week. Also India & China – two of biggest gold market are seeing increased physical demand as businesses stocked up on gold while price was cheap. Yellow metal also saw action in other emerging markets across South East Asia. As of writing this article, spot gold XAUUSD is trading at $1292.70 per ounce up by 0.48% on the day while gold futures GCcv1 was trading at $1292.80 per ounce up by 0.41% on the day.
Meanwhile spot silver XAGUSD is trading at $15.68 per ounce up by 0.78% on the day. Crude oil price continues to rise across this week despite short stumbling block in form of US EIA crude data but the same failed to have any major impact on overall market price action in short to medium term. Today, both futures and spot market saw oil price rise by 1% as crude market continues to gain positive price influence owing to optimism surrounding positive proceedings in Sino-U.S. trade negotiations. Given that China is world’s biggest crude oil importer this is positive news for crude oil market and price is also supported by tightened supply from OPEC’s production/supply cut measures which came into effect since start of this month. As of writing this article, Spot US Crude oil WTIUSD is trading at $52.86 per barrel up by 1.26% on the day.
This article was originally posted on FX Empire
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