gold has been pushed higher on global inflationary concerns, and amid fresh geopolitical concerns

Upward momentum in gold stalled yesterday, as the release of last month’s FOMC minutes brought into question the Fed’s commitment to its accommodative monetary stance. The report suggested that there had been differences amongst members on whether data pointing to a stronger recovery might warrant a reduction in the planned $600bn monetary stimulus.

Nevertheless, the general consensus on the FOMC remains cautiously optimistic and that recent data flow did not change the outlook sufficiently to substantiate a change in QEII plans. Since yesterday’s fall, gold has been pushed higher on global inflationary concerns, and amid fresh geopolitical concerns prompted by allegations that two Iranian warships were heading via the Suez Canal to Syria. The latest news is that this will not be happening, although this highlights the sensitivity of markets to tensions in the MENA region. This should continue to provide for support precious metals.

Gold support is at $1,370 and $1,362. Resistance is at $1,385 and $1,391.

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