Gold: Sharp fall unlikely - Commerzbank

Gold prices will continue to be impacted by greater risk appetite among investors, while industrial metal prices are currently reacting above all to speculation about new stimulus measures in China, said Eugen Weinberg, analyst at Commerzbank.

Key Quotes

“In the absence of stimuli from the data front and ever decreasing activity among market participants in mid-summer, commodity prices are likely to move sideways.”

“The gold price has come under pressure recently due to increased risk appetite and hence rising equity prices – the S&P 500 has climbed from one all-time high to the next.”

“Moreover, the earlier price rise was highly speculatively driven, which now stands in the way of a further increase. A sharp fall in the gold price is unlikely given the numerous crises around the world.”