Gold hits new records as safe-haven demand surges – ING

FXStreet Insights Team FXStreet

Gold surged to fresh record highs above $4,600 an ounce as geopolitical tensions, fiscal uncertainty, and strong central bank buying fueled demand for safe-haven assets, ING's commodity experts Ewa Manthey and Warren Patterson note.

Fed independence fears and geopolitics boost metals

"Gold climbed to fresh records as a range of supportive factors converged. They include geopolitical risks, elevated fiscal uncertainty, strong central bank demand, and ongoing concerns about inflation and monetary credibility."

"The US Justice Department threatened the Federal Reserve with a criminal indictment, reviving concerns over the central bank’s independence. The dollar fell, boosting the prices of metals. Protests in Iran keep geopolitical tensions elevated, while President Trump has reiterated threats to take Greenland, bringing further upside to precious metals."

"Gold surpassed $4,600/oz in yesterday’s trading, while Silver surged past $85/oz. Silver has already climbed around 20% so far this year, following an almost 150% surge last year. This has pushed the Gold/Silver ratio below 60, the lowest level since 2013."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD clings to multi-day peaks below 1.3500

GBP/USD trades with marked gains on Friday, now giving away some gains following an earlier surpass of the key 1.3500 yardstick. Indeed, Cable gathers fresh steam amid the strong offered stance in the Greenback, all after US NFP badly missed expectations in July.

EUR/USD: Post-NFP bounce falters around 1.1580

EUR/USD reverses Thursday’s decline and trades with solid gains in the 1.1560 region, or two-month peaks, on Friday. The pair’s firm performance comes in a context of a sharp correction in the US Dollar as investors continue to assess disheartening US NFP readings.

Gold trades below $4,350; remains close to seven-week high

Gold is seen consolidating Friday's post-NFP rally and trading just below $4,350 at the start of a new week, close to its highest level since June 17. Meanwhile, weak US jobs data tempered Fed rate hike bets, which keeps the US Dollar on the defensive and acts as a tailwind for the non-yielding bullion. Meanwhile, the focus now shifts to this week's US inflation figures as traders await developments surrounding the Middle East crisis.

Week ahead: US CPI data, BoJ summary and RBA decision take the stage

US inflation data to guide Fed rate hike expectations. A hawkish BoJ summary of opinions could support the Yen. RBA could still sound hawkish amid sticky inflation. UK GDP and activity figures to shape sterling sentiment.

CFTC Report: FX repositioning dominates as commodities diverge

The week in one sentence: a historic Yen short unwind led to a broader recovery in FX positioning, while Gold strengthened with price confirmation, and renewed selling in WTI and Coffee reinforced commodity weakness. The Japanese Yen delivered the report's dominant move. Net positioning improved by nearly 118K contracts, the largest weekly increase since at least 2011.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.