Gold trades sideways – What’s the reason behind it?

Gold remained stuck in a narrow trading range of $1,197 - $1,202 as most of the traders preferred to invest in the dollar.  

Gold

Gold prices are edging higher in a lighter mode due to weakness in the Greenback. China and the United States jumped deeper into a trade war after Beijing replied by adding $60 billion of US products to its import tariff list. That came in response to the President Donald Trump’s proposed duties on $200 billion worth of Chinese goods. This drives the safe haven demand for gold and dollar both.

Gold remained stuck in a narrow trading range of $1,197 – $1,202 as most of the traders preferred to invest in the dollar.

Two Reasons To Know

First – The investor thinks the US has much less to lose in this trade war and this is somehow beneficial for the United States. So they invested in it rather than in gold.

Second – Federal Reserve, the central bank of the US, is due to release the interest rates and odds for an interest rate hike are very strong. Therefore, investors are staying in dollar rather than in gold.

Consequently, the demand for the precious metal is a bit less when compared to the dollar.



ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

Related Articles

Comments

0 0 votes
Article Rating
Subscribe
Notify of
0 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments

HFM

Doo Prime

XM

Best Forex Brokers