Will gold prices stay range-bound in the current scenario?
In the present scenario, gold is expected to keep its nearly si week-old range of $3950-$4200. Gold price prediction today Gold prices will continue to
In the present scenario, gold is expected to keep its nearly si week-old range of $3950-$4200. Gold price prediction today Gold prices will continue to be influenced by US-Iran talks and macroeconomic data in America which would likely provide direction to the Federal Reserve on its rate decisions, says Praveen Singh, Head Currencies and Commodities, Mirae Asset ShareKhan. Performance On August 3, despite a sharp decline in oil prices, spot gold traded in a range of $4019-$4084; bulls remained cautious as a crucial week unfolds. In the week ending July 31, spot gold closed with a loss of 0.2% at $4043. At the time of writing this article on August 3, the yellow metal was trading with a loss of 0.15% at $4036. Geopolitics and oil Global oil prices began the month and the week a sharp decline of over 5% as the US and Israel cancelled a planned strike on Iran's energy infrastructure. Reportedly, Saudi Arabia, Qatar and the UAE urged the US to call off the strike and follow the path of diplomacy to reach an agreement with Iran over the contentious issue of the Strait of Hormuz.. The US President Trump said that Iran talks will begin Monday as Hormuz and nuclear deals are imminent. He did not offer much detail though. Iran said that talks with Oman to allow more ships to sail through the Strait are making progress; focus of the talks is on securing a temporary route to ensure safety of ships. Iran denied that talks are planned with the US. Trump also said that a diplomatic deal must be reached quickly that must include immediate, complete and total reopening of the Strait. He added that Hormuz is controlled by the US Navy and nothing gets to Iran without US approval. Iran has issued a Gulf-wide energy hit list should Trump carry through strikes on the country's energy infrastructure.
Meanwhile, Israel conducted fresh strikes on Gaza despite Hamas agreeing to disarm, albeit conditionally. Fresh attacks on Gaza could jeopardize peace deal revival. Brent crude oil futures slumped nearly 9% to $81.55 on August 3 before cutting some losses. Futures were trading at $84.47, down nearly 6% at the time of writing this article. Dollar Index and yields The Dollar Index has come under significant downside pressure due to a dovish FOMC outcome, intervention by the US and Japan in currency markets to prop up the ailing Yen and a sharp decline in oil prices that has improved risk appetite. On Monday, the Index fell to 99.41, lowest since mid-June before recovering on strong US manufacturing data. At the time of writing, the Index was trading largely steady at 99.96. In the week ending July 31, the Index posted a loss of 1.5% to settle at 99.91. Currently, it is down nearly 1.8% from its cycle peak of 101.80 reached on June 24. Two-year US yields at 4.25% were down 0.80% on Monday, while ten-year yields at 4.69% were down 1%. In the week ending July 31, 2-year yields fell 0.80%, while ten-year yields rose to a fresh-cycle high of 4.745% before settling at 4.73%-- 1.25% higher for the week. Data roundup S&P Global US manufacturing PMI came in at 53.90 Vs the estimate of 53.80 in its July final reading. ISM manufacturing at 55.60 (forecast 53.90, prior 53.30) expanded at the fastest pace since May 2022 as ISM price paid remained elevated. New orders improved further and the employment index shot back into the expansion zone for the first time since April 2022. Construction spending unexpectedly declined in June after stagnating in May. RatingDog China manufacturing PMI fell to 50.90 in July as against the forecast of 52 and the prior data of 51.70.
The BriefWire