US economic data drives the Gold price
US economic data is currently the driving force behind Gold: Reports about inflation and good retail sales fuel interest rate hike phantasies and put the metal under pressure. Disappointing US data such as industrial production, on the other hand, result in price increases. This happened last Wednesday, when Gold marked the week’s low at 1,217.50 $/oz in order to then close the day at 1,233 $/oz. This kind of volatility is likely to stay the same over the coming months. Fed chief Janet Yellen recently signalled that the US economy was prepared for an early increase in key interest rates. Economic data confirming this assessment will put a strain on the Gold price in the coming weeks and months. The degree of respective price corrections will ultimately depend on the behaviour of investors. They regularly used price dips of recent days for purchases. One reason for this are the real interest rates, i.e. market interest rates adjusted by the inflation rate. These remain unchanged at near zero in the Dollar zone. Regardless of these potential fluctuations, we anticipate that the generally positive sentiment in the Gold market remains intact. The uncertainty surrounding the policies of US President Trump, the forthcoming elections in the Euro zone, the ongoing discussion about the stability of Italian banks as well as new speculations regarding the economic development of Greece are only a few of the reasons that support our assessment. Gold encounters first resistance at 1,248 $/oz, after which the path is cleared up to 1,270 $/oz.