After falling yesterday, gold is enjoying a small rebound this morning. After falling sharply last week and continuing to fall this week, we will downgrade our medium-term outlook on gold to bearish later today. Given upcoming US PPI numbers later today, there is a risk that gold weakens further if inflation figures are higher than expected. We expect this week's PPI and CPI numbers to be strong given the effects of higher crude oil in November. The other risk for the precious metal this week is the upcoming Federal Reserve meeting. As this is Janet Yellen's last meeting as Fed Chair, there is a risk that the Fed's statement is more hawkish than the market's expectations. Our short-term outlook on gold remains bearish.
After its most recent top around $1,299, gold is now below $1,244.