After the recent correction in gold prices on robust US job data, analysts expect gold prices to move up in the upcoming week on US Federal Reserve’s interest rate cut and hopes around US-China meet to discuss a trade deal.
After the recent correction in gold prices on robust US job data, analysts expect gold prices to move up in the upcoming week on US Federal Reserve’s interest rate cut and hopes around US-China meet to discuss a trade deal. Gold remained stable on Friday after the yellow metal shed 1% in the previous session on robust US jobs data. The analysts are crossing their fingers on US Federal Reserve meeting which may announce interest rate cut, giving momentum to the gold prices. Today, spot gold rose 0.3% to $1,418.40 an ounce by 0958 GMT. The US gold futures gained 0.3% to $1,418.50.
“The US Federal Reserve meeting next week is expected to be positive for the gold prices after the dovish comments of Fed Chair Jerome Powell. US-China meeting in Shanghai on trade deal also augurs well for the yellow metal. We expect gold prices to go up next week. We recommend BUY on gold with some dip in prices,” Jigar Trivedi, Fundamental Analyst, Commodities with Anand Rathi Shares and Stock Brokers told Financial Express Online.
Today, the US will come out with its GDP data which is expected to have grown at the slowest pace in two years, according to Reuters. The US GDP data is likely to come at 1.8 per cent. According to Ajay Kedia, Director with Kedia Commodity, the US GDP data is likely to be positive for the gold prices going forward. He said he is positive on gold in the short-term considering interest rate cut next week by the US Federal Reserve and fall in equity markets. Some pullback is expected but short to the medium-term outlook remain bullish, said Kedia.
However, Amit Sajeja, Associate Vice President with Motilal Oswal Financial Services is negative on the gold prices on account of the strong dollar index. The primary reason for his negative outlook on gold is strength in dollar index after yesterday’s dovish ECB comments for the euro. “Looks negative below 35200, could target 34550-34500 in the coming week. Selling on rallies is advised below 35200,” Amit Sajeja told Financial Express Online.