Yahoo Finance Price of Gold Fundamental Daily Forecast – Supported by Lower Treasury Yields, Weaker U.S. Dollar
Gold futures are trading higher on Tuesday as investors continue to gauge the movement in the U.S. Dollar which is being influenced today by forecasts of a weaker global economy. With the market hovering near a three-week low, investors are trying to decide which safe-haven asset to choose from, the U.S. Dollar or gold.
At 1159 GMT, February Comex gold is trading $1281.8, up $2.20 or +0.16%.
Also helping to underpin gold are falling U.S. Treasury yields and lower demand for higher-yielding assets.
Traders haven’t had much economic data to assess lately due to the partial government shutdown so the dollar/gold relationship is back in play. Furthermore, investors know the Fed’s stance on policy and can determine risk appetite with the performance stock market.
Forecast
Gold should have been supported by reports of weaker Chinese economic data and the International Monetary Fund’s cut in global growth forecasts, but traders have showed almost no reaction.
The Fed’s dovish outlook and slower global economic growth had been driving gold prices higher. But this has changed recently with gold traders focusing lately on Treasury yields and the movement in the U.S. Dollar. We expect to see these two factors exert the biggest influence on gold prices today.
There is only one report today. At 1500 GMT, U.S. Existing Home Sales are expected to come in at 5.27 million units. This will be lower than the previous read of 5.32 million units.
This article was originally posted on FX Empire
