Gold Steady as Dollar Dips, Geopolitical Tensions in Focus
Gold prices trading somewhat steady and have come under slight pressure early on Tuesday over an improvement in the market sentiment
Gold prices trading somewhat steady and have come under slight pressure early on Tuesday over an improvement in the market sentiment, which has driven equities higher as traders look forward to economies restarting in the coming weeks. At the time of writing, GOLD is trading at a little above $1,734.
Gold prices, however, enjoyed some support from a weakening in the US dollar, which shares a negative correlation with the precious metal. A falling dollar makes gold more affordable for holders of non-dollar currencies, increasing its demand and value as a result.
Meanwhile, geopolitical tensions keep gold supported as China gets ready to impose a national security legislation on Hong Kong. The Chinese foreign ministry in Hong Kong has termed last year’s pro-democracy protests as acts of terrorism, a sentiment echoed by the security chief in Hong Kong as well.
In addition, Iran has successfully sent a second shipment of fuel to Venezuela despite US sanctions – a move which is likely to receive a response from the US government shortly. Despite optimism about economic activity restarting, gold’s safe haven appeal is likely to remain in favor in global markets amid these worries.
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