An Iranian oil tanker was hit by an explosion leading to oil spilling into the Red Sea, near the Saudi Arabian port city of Jeddah, in a possible "terrorist act", Tehran's state media said. Oil futures continue to extend gains. Spare capacity remains fragile and with supply chain vulnerability a worrying concern at virtually every middle east oil field, traders continue to hedge supply risk premium.
Gold prices are bouncing on the possible terrorist attack as geopolitical risk premium rachet higher.
But Gold prices remain resilient even though bullish momentum wanes, and perhaps the only thing is holding investors from committing full force is waiting for the trade talks to end to make sure no “risk-on " empowering surprise to get pulled out of the hat.
Global data remains weak, and that is unlikely to change if as expected trade talks end with only a tariff detente which is unlikely to shift the expectations immediately for Fed easing through 2019.
In addition, Gold remains supported via ETF inflows which seemingly march on inexhaustibly: Thursday marked the 18th consecutive day of buying, the longest run of inflows since 2009
USD/KRW is trading offered with general optimism on the US-China trade deal and a slew of new contracts by shipbuilders boosting sentiment for the local currency.
USD/CNH traded down to 7.0890 after US President Trump's optimistic comment on the trade talks with China. But dips remain bid . One-month CNH/CNY basis gapped down to 180 at the open but met good dip-buying interest.
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