Gold Fundamental Forecast: Neutral
- Gold prices give up gains amidst geopolitical risks cooling and hawkish FOMC minutes
- The anti-fiat asset can be vulnerable to risk trends thanks to the high-yielding US Dollar
- Watch out for US retail sales, Fed commentary + beige book, and Trump commentary
Gold prices seemed like they were about to shoot for the stars last week as fears of escalating geopolitical tensions around Syria ignited risk aversion. Stocks sank and the relatively higher-yielding US Dollar fell, fueling demand for the anti-fiat yellow metal. However, this trading dynamic quickly reversed, and by Thursday gold gave up its gains from the day before. Cooling Syria conflict tensions and hawkish FOMC meeting minutes helped contribute to this.
The week ahead looks to be lighter in terms of economic statistics. The major standout being March’s US retail sales figures that are due on Tuesday. There, consumer spending is expected to increase for the first time in two months by 0.4% m/m. However, data out of the country has been falling short relative to economists’ expectations as of late. A downside surprise may boost gold if the US Dollar declines as a result.
Central bank-wise, we have a plethora of speeches from Fed policymakers that may fuel US Dollar volatility and thereby impacting gold. San Francisco Fed President John Williams, who was announced to replace New York President William Dudley, will speak on