Gold Prices Slipped Ahead of Dispute Talks
Earlier this week, gold prices retreated with the US dollar appreciating and investors' cautious anticipation ahead of the resumption of trade talks between the United States and Chinese officials. Prior to that, the yellow metal will be at an important date with the release of the minutes of the Fed's monetary policy meeting last month to see the central bank's expectations on the future of US interest rate cuts. The price of gold fell to the $1488 level after opening the week's trading around the $1508 resistance, and stable around the $1493 level in early Tuesday trading.
Before the talks began, US President Donald Trump said on Friday that his administration had a "very good opportunity" to agree on a trade deal. In contrast, a report in Bloomberg, citing some people familiar with the talks, said Chinese officials are reluctant to approve a comprehensive trade deal under US President Donald Trump's policy.
US and Chinese officials, including Vice Premier Liu He, are expected to resume trade talks on Oct. 10-11. However, reports over the weekend suggest that Beijing negotiators may aim to conclude a limited trade deal for less than the Trump administration hopes.
Despite the bearish correction of gold prices, there are still factors supporting the return of gains at any time. The most important of which was the civil unrest in Hong Kong, the situation in the Middle East, Brexit, and the ongoing US-China trade war. China will return to global financial markets after a week-long holiday, which could move the price of gold higher as China is the world's largest gold consumer.
The results of the latest US jobs report supported expectations that the Fed will go ahead with a quarter percentage point rate cut at the end of October, which will spur gold gains. The price of the yellow metal ended the September trading with repeated losses, down 2.2%, and gave up the $1500 psychological resistance.
- Currency Pairs