Gold ended the day down on Friday, but has made up for its losses today. We have downgraded our short-term outlook on gold to neutral as momentum runs out of steam. While gold has been trading in a range in November, the precious metal should be supported by doubts regarding the upcoming US Senate tax vote and the weakening inflation outlook. This week's Core PCE figures (to be announced on Thursday) will be critical for gold. If Core PCE is stronger than expectations, there is a risk that the outlook for inflation strengthens which would result in lower gold prices. If Core PCE is weak, the opposite is true.
After its most recent top above $1,300, gold is now above $1,292.