Gold is currently flat, mirroring moves in the US dollar. Yesterday, gold prices strengthened after we published our gold daily update. The US dollar ended the day down following strong Eurozone manufacturing PMIs. The dollar tends to weaken when ex-US growth is strong. While nominal bond yields are surging (10-year US Treasuries yields are just below 2.8% today), higher yields have had a limited impact on the precious metal. Over the long term, gold trades inversely to real interest rates. Yesterday, we published a broader commentary on gold and predicted that the precious metal is set to keep strengthening. While future rate hikes are likely to cause speed bumps along the way, the ongoing boom in developed and emerging markets is bullish for gold. Our short-term and medium-term trending indicators suggest that gold remains in a bullish trend.
After its most recent bottom around $1,240, gold is now above $1,348.