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Mt4.mt5 related news - gold price outlook: strong dollar + rising yield vs recession concerns + war risks, who can dominate the gold price trend?

发布时间：2022-08-25 浏览：121

Key points of gold price:

• gold price fundamentals Outlook: neutral

• the strengthening US dollar and higher yields were offset by geopolitical risks and recession concerns

• conflicting market forces cause the gold outlook to be neutral in the short term

The strength of the US dollar and the rise in yields drove down gold prices

Gold prices rose 0.7% to around 1945 last week, despite a general rise in the dollar and soaring interest rates.

In the five trading days last week, the US dollar index rose 1.3%,

The Federal Reserve has made it clear that it is inclined to raise interest rates in advance,

After outlining a plan to significantly reduce the balance sheet and cool inflation, the yield curve of US Treasury bonds rose sharply.

Generally, the strength of the US dollar in the foreign exchange market and the rise in nominal and real yields should be enough to weaken precious metals,

Because precious metals do not provide coupons, dividends or tangible cash flows. But last week, the gold price still rose slightly, at least it can be said that this is not a normal period.

Geopolitical risks and recession concerns supported gold prices

First, the geopolitical premium formed after Russia's invasion of Ukraine has supported the prices of some defensive assets.

Although the military conflict has not escalated sharply in recent days, the war is still raging and the danger is far from being eliminated. At present, it is difficult to predict how the crisis will end,

However, some investors believe that the worst period is not over yet, so they are unwilling to start cutting their safe haven positions.

Secondly, the market is increasingly worried about the economic recession. Many Wall Street observers are increasingly convinced that the Fed will not be able to bring down inflation without triggering a severe recession.

Whether these expectations are reasonable is another matter, but the fragile sentiment reflected by high volatility and weak stock market is prompting traders to hedge against potential downside risks.

Conflicting market forces will prevent the price of gold from rising or falling substantially until one of the catalysts gains a clear advantage.

This means that the recent trading prospect of gold / US dollar is neutral. Under this background, the gold price may stay at the current level,

It lacks directionality and will continue to show horizontal fluctuations in the next few days.