Gold prices bounced back in early Thursday trading, after hitting a one-month low during Wednesday’s session. The price of bullion recovered some of its losses, climbing back above the $3,300 level. The previous session’s decline was driven by a strengthening US dollar and rising Treasury yields, following the Federal Reserve’s decision to keep interest rates unchanged and its indication that a rate cut in September is unlikely. Adding further pressure on the precious metal is the increase in risk appetite across financial markets, fuelled by strong earnings from major tech companies. These factors continue to weigh on gold. However, with the 1 August deadline approaching for the imposition of US tariffs on countries that have not reached trade agreements, renewed uncertainty is supporting demand for safe-haven assets. In this context, the upside for gold remains closely tied to the evolving trade narrative: the more executive orders signed by President Donald Trump imposing tariffs on other countries, the greater the potential for upward pressure on bullion prices.
Ricardo Evangelista, ActivTrades
Source: ActivTrader
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