Gold prices continue to shine this morning, and the precious metal is almost at $1,330. Gold ended the day higher yesterday and continues to rise today thanks to weakness in the US dollar. As we wrote in today's US dollar daily update, USD is weakening in relative terms thanks to euro strength. The euro is higher after ECB minutes suggested that the Bank will communicate a change in policies in early 2018. As the market expects the ECB to end its asset buying program later this year, the euro is strengthening as a result. Looking at bond yields, nominal interest rates are mostly flat this morning. The move up in gold is thus primarily a consequence of weakness in the US dollar today. Our short-term and medium-term outlook on gold remains bullish.
After its most recent bottom around $1,240, gold is now above $1,329.