Economic Slowdown And Uncertainty Breathe Life Into Gold, Says Analyst
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(Kitco News) -Renewed trade war fears are breathing life into the gold market as the possibility of a rate cut enters investors’ minds, this according to Phil Streible, senior market analyst at RJO Futures.
“Potentially down the road, if equities slow down, and if the global economy slows down enough, you might see the Fed cut rates, that’s what’s breathing life right now into that gold market,” Streible told Kitco News.
His comments come as gold reacted positively to news that the trade war has escalated, with spot gold trading 1% higher on the session Monday.
Streible noted that this time around, the trade war’s ramifications could be here to stay.
“Now what we’re seeing here is that it looks like it’s going to go on for a prolonged period of time, it looks like there’s no resolution in sight. As a result of that we’re seeing a washout in the equities markets, the talk about a potential slowdown,” he said.
Streible said that should stocks fall more, the Federal Reserve may be inclined to put a brake on rate hikes, or even cut interest rates.