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TDS: 'Gold At $1,300/Oz Is Well Within Reach'

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Gold prices of $1,300 an ounce are “well within reach,” particularly amid potential for increased volatility and risk in other markets, says TD Securities. Gold benefited early Monday after U.S. President Donald Trump threatened increased tariffs against China, with equities and industrial commodities such as oil and copper coming under pressure. Gold later retreated while equities, oil and copper all bounced, with risk appetite returning with markets seemingly viewing the Trump’s “aggressive statements” as an effort to pressure China rather than a willingness to engage in a full-blown trade war. TDS analysts say they expect an eventual trade deal between the U.S. and China, but also say markets may have already factored in a best-case scenario. “The higher market vols and risk profile should see an increase of capital flows into gold from both private and official sectors,” TDS says. “Gold at $1,300/oz is well within reach.” As of 9:26 a.m. EDT, spot gold was 80 cents stronger at $1,281.40 an ounce.

By Allen Sykora of Kitco News; asykora@kitco.com

 

RBC’s Gero: Stronger U.S. Dollar Nudges Gold Futures Lower

Monday May 7, 2019 09:37

Gold futures are modestly lower as the U.S. dollar ticks higher, says George Gero, managing director with RBC Wealth Management. He said the metal is pulling back after euro-zone economic data were deemed “very anti-inflationary” and the euro weakened. As of 9:02 a.m. EDT, Comex June gold was down $3.10 to $1,280.70 an ounce. The June dollar index was up 0.197 point to 97.465. Gero adds that a number of factors – trade tensions, uncertainty about Brexit and more – have been “reasons to delay buyers for now, keeping range-bound gold prices [in the] $1,275 to $1,300 area.”

By Allen Sykora of Kitco News; asykora@kitco.com

 

Commerzbank: Investors Still Not Warming Up To Gold ETFs

Monday May 7, 2019 09:37

Inflows into global gold-backed are not taking place despite geopolitical risks, perhaps because investors anticipate these situations will be resolved, says Commerzbank. U.S.-China trade tensions escalated again this week, and the U.S. is sending an aircraft carrier to the Middle East as a warning to Iran. “Gold should profit if this further increases the geopolitical risks,” Commerzbank says. “As yet, however, this is leaving gold largely cold, as is the escalation of the trade conflict. There is still no end to the ETF outflows; as of yesterday, ETFs had sold gold on nine out of the last 10 days of trading. It is not clear to us what is motivating ETF investors to continue to sell gold now. It appears that many market participants still assume that the various flashpoints will not flare up any further, and that agreement in the trade dispute will be reached sooner or later.”

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