In the last two weeks, fresh updates from the trade talks between two macro economies, U.S and China have emerged.
Firstly, the video conferencing call between Chinese Vice-premier, Liu He and two top U.S trade officials which were hailed as a constructive one. This came barely two days after reports speculated preliminary pact almost been reached amongst the two countries.
Secondly, President Trump’s recent announcement corroborating the fact that the two countries are working closely to resolve their trade differences and a preliminary pact will soon be signed.
Thirdly, over the weekend China made it known that it is propping up support for intellectual property rights. This may in a way tend to conflict resolution both in the U.S and Hong Kong sides respectively.
A future analyst weighing the impact of the moves on the market said in the view of the progress made in the trade talks and also favorable economic stats which are due out, the market mood is optimistic, thereby propping up the dollar and other riskier assets while undermining the safe-haven metal.
Gold, the Safe-Haven Metal
The safe-haven metal was reportedly down in response to the trade moves as it fell to a 2 week low.
Spot gold fell by 0.1% to stand at $1,454.19 per ounce in the early hours of today, trending on a 2 week low.
U.S. gold futures neared 0.2% drop to $1,453.80.
While Gold traded on a two week low, the reverse was seen in the dollar and Asian stocks which traded on a two week high in response to the trade talk update.
However, the week started on a quiet note as there are no substantial stats to influence the market apart from the trade talks holding the cards while released stats show slowing economies as Germany barely escaped a recession, so the market move is still gold on.
The safe-haven metal has profited more than 13 percent this year on account of the trade disputes and its perceived inclination towards a global recession.
The Federal Reserve has reiterated that holding steady its interest rate cut after the third time this year is supportive of the U.S economy intending that lower interest rates discourage savings and support investments which are a boost to the economy.
Due out later on today is U.S. consumer expectation stats.
On the other side, silver followed suit as it fell by 0.3% to trade $16.85 per ounce, trading on a week low.
Palladium and platinum edged higher by 0.1% to trade at $1,798.99 and $897.44 respectively.
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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.