Gold bulls hold in there on geopolitical and trade risks, despite robust USD
|- Gold prices were elevated on the back of Chinese trade data and geopolitical risks.
- The US dollar has been a market favourite following Friday's NFP surprise.
Gold prices were under pressure at the start of the week as the US dollar seeks correction of the latest slide following a very healthy headline accumulative number in US jobs creation which included strong revisions. Gold is currently trading a touch higher in the US session, having travelled from a low of $1,458.90 to a high of $1,465.36 so far, +0.03%.
Firstly, the US jobs report showed that American firms added 266,000 new positions in November, a much higher outcome than the 180,000 forecasts. We also had revisions to the September and October which came in at 41,000.
When taking into account how the jobs market has continued to expand throughout 2019, the US dollar can be considered as a must pick for the start of 2020. We have the Federal Reserve interest rate decision this week and projections. Economic projects are expected to be higher on the back of this data. The Atlanta Fed increased its GDPNow program estimate for the fourth quarter to 2.0% from 1.5% on December 6th following the data. The Fed's prior estimate had been at 2.2% for 2019 growth.
Chinese risks help buoy Gold
Elsewhere, however, the global economic outlook was not seeming so rosy due to the weekend's release of China's trade data. This showed that exports to the U.S had fallen 23% year-over-year in November. More broadly, exports to all countries fell 1.1% year-over-year. Consequently, the data fuelled a safe-haven bid into gold prices and stalled the US jobs data sell-off. There has also been news that the US tariffs on Chinese imports are still scheduled to go on the 15th of this month and that China is already preparing for them to go active.
Gold levels
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