Gold: Longer-term landscape improves – TD Securities

TD Securities’ Ryan McKay and Bart Melek note that speculation of currency intervention and less hawkish Federal Reserve commentary have supported precious metals, with Gold moving away from nearby CTA selling triggers. They highlight upcoming US data as key for the next leg higher, while stressing that the longer-term backdrop for Gold has materially improved as Dollar debasement concerns grow.

Dollar softness supports yellow metal

"Speculation of currency intervention has weighed on the dollar, while less hawkish comments from Fed's Waller has pressured interest rates lower."

"This has given precious metals a lift higher in the morning session, seeing CTAs turn buyers in silver and palladium, while gold moves away from nearby CTA selling triggers."

"Non-farm payrolls this Friday, and inflation data next week, will be of keen interest for precious metals given the renewed hawkish tone from Fed Chair Warsh at Jackson Hole and the latest escalation in the energy market."

"With hike pricing remaining elevated amid lingering inflation concerns, timing remains the main question for the next leg higher in the yellow metal."

"That said, the longer-term landscape for precious metals has materially improved amid a renewed dollar debasement theme, and given Fed hikes are far from certain."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)