According to Motilal Oswal, At the tail end of a volatile four-day week, gold prices have settled down after some strong selling that followed new 8 year highs for the precious metal in both spot and futures markets.
Motilal Oswal's report on Precious Metals Weekly
At the tail end of a volatile four-day week, gold prices have settled down after some strong selling that followed new 8 year highs for the precious metal in both spot and futures markets. Market participants were confused on how to react to multiple contradictory events taking place globally like the trade war tussle between US-China, geo political issues, positive economic data points, easing in the lockdown despite rising number of cases amidst COVID-19 and others. The WHO added a voice to the doomsayers by striking a dramatically pessimistic tone about the near-term outlook, but traders in the US seemed were content to focus on more positive data points recorded in U.S.
As we move into the second half of the year, this week we’ll see if service sector activity from the US can match the rebound in the industrial sector that was reported last week. Beyond that, the economic calendar is pretty light but market participants will continue to keep an eye on the US-China trade relationship. Apart from US-China tussle focus will also be on the border tensions. Focus will also be on measures taken by the leaders in order to combat the COVID-19 as it remains a core driver for highly risk-sensitive markets like gold.
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