Gold: Buyers dominate around $1333 amid Hong Kong Protests, China data
- Hong Kong protesters oppose the government’s decision to debate extradition to China in the parliament.
- China CPI rose to a 15-month high.
- US CPI will be the key to follow from now.
With protests in Hong Kong turning serious and China’s inflation data meeting expectations, gold prices surge to the intra-day high around $1333 during early Wednesday.
The yellow metal was on its back foot since the week’s start as relief from trade tussles trimmed safe-haven demand.
However, threats to Mexico and China from the US President Donald Trump, coupled with criticism to the Fed, restricted the bullion’s downturn.
In Hong Kong, the government’s decision to debate a law in the parliament to allow extradition to China met with wide protests that turned violent. However, latest reports suggest that the government has postponed debate on the extradition bill to an unspecified time.
On the other hand, inflation numbers from China, one of the world’s largest Gold customer, met market expectations wherein the consumer price index (CPI) grew to 2.7% from 2.5%.
The global risk barometer, US 10-year treasury yield, remains mostly unchanged at 2.141% by the press time.
Today’s US CPI data will be on the traders’ radar as the greenback has an inverse relation with the precious metal. The headline inflation gauge may decline to 0.1% from 0.3% but CPI ex-food and energy can increase to 0.2% from 0.1% on a monthly basis.
Technical Analysis
Having reversed from $1320, the quote can rise to $1342 ahead of targeting current month high around $1348 while a downside break of $1320 may fetch prices to April high near $1310 and then to $1300 round-figure.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
