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Its been an unusually quiet week for gold prices following the large move over the prior week in response to news of the US-China trade deal.
With the two sides agreeing on the phase-one trade deal, risk sentiment has been much better supported this week, limiting the upside in gold. The US has agreed to a substantial reduction in tariffs in exchange for China agreeing to heavily increase US agricultural purchases.
The trade talks will then move onto discussing the next phase of the trade deal in January. The market is hopeful that the superpowers can finally dismantle the tariffs which have been in place over the last two years. This could be a major boost for risk appetite, likely seeing gold trade lower on reduced safe-haven demand.
The upside in gold has also been capped by a recovery in the US dollar this week. Despite the continued rally in equities, the USD recouped some of last week’s losses as the market reacted with relief to the latest US manufacturing data.
While the r...
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