Based on its market cycles, gold has had a nice run but higher prices are still possible.
Chennai: After the steep rise in gold prices, a huge sell-off was witnessed in the country's key gold markets on Friday.
"As rates fall the United States dollar will likely weaken as well", David Lennox, resource analyst at Fat Prophets wrote in an email adding, "the weakness in the greenback "could be amplified" by any return to easing policies". The commodity is now trading 1.66% higher at around $1,382.91 per ounce.
According to CNBC, gold prices spiked during Asian trading hours on Thursday after a dovish U.S Federal Reserve opened the door to further rate cuts.Читайте также: Korea may make Abe-Kim summit less feasible
This boosted stocks as lower rates makes it cheaper for companies to borrow money and grow their business or buy back their stock.
"Gold should remain in demand as a safe haven and as a store of value", said Commerzbank analyst Daniel Briesemann. "Attacks on oil vessels (where blame has been attributed to Iran) and yesterday's downing of a USA drone, which Iran's Revolutionary Guard claimed responsibility for, clearly highlight the potential for military escalation". At that time there was also great uncertainty on the financial markets. "A slowing global economy, imminent USA rate cuts and rising geopolitical tensions provide a near ideal storm for gold bugs - and while this trio of factors remain in place the rally. will remain well supported", said XTB chief market analyst David Cheetham.
With expectations for the U.S. U.S. President Donald Trump tweeted that "Iran made a very big mistake".
And as questions linger about how much this epic market rally - now more than ten years long - can last, investors may continue to look at gold as a way to protect themselves in case stocks fall sharply. Among other precious metals, silver dipped 1% to $15.26 an ounce, while platinum was up 0.5% to $806.27.При любом использовании материалов сайта и дочерних проектов, гиперссылка на обязательна.
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