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Gold holds $1,450 support on dovish Fed outlook - TD Securities

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Gold prices are managing to hold above the $1,450 an ounce level on the view that the Federal Reserve might cut rates again in 2020, according to TD Securities. “Gold continues to hold above the $1450/oz despite record highs in equities and record online Black Friday sales, as the asymmetry in the US central bank's reaction function suggests that while the Fed may cut rates, they are far from hiking and are likely to allow inflation to creep higher, thereby suppressing real rates and maintaining the allure of gold in a portfolio,” write strategists at TD Securities. The banks projects two more rate cuts by the Fed in 2020 as growth slows. “Deceleration in growth will ultimately provide the market with the impetus to pressure the Fed into cutting rates twice more in 2020,” the strategists add.

By Anna Golubova of Kitco News; agolubova@kitco.com

Investors begin December ‘in a positive mood’ - FXTM

Monday December 02, 2019 10:36

Investors are beginning the last month of the year “in a positive mood,” writes FXTM chief market strategist Hussein Sayed. “The risk-on mood was driven by better than expected economic figures out of China. The Caixin/Markit manufacturing Purchasing Manager’s Index rose to 51.8 in November, marking the fastest expansion in activity since December 2016. Meanwhile, the official manufacturing PMI released over the weekend returned to growth for the first time in seven months and crucially above the 50 threshold,” Sayed writes. They key dataset to pay attention to this week is Friday’s U.S. jobs numbers, with FXTM projecting to see an increase of 180,000 in November. “Barring any surprises, the figures may justify Fed Chair Jerome Powell’s assessment that the economy still has room to continue its current expansion,” Sayed adds.

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