Gold price retreats below $1,540 as US stocks turn positive on day

Washington (Aug 28)  Yesterday, the 30-year US Treasury bond yield and the 3-month US Treasury bond yield inverted for the first time in more than ten years and revived concerns over a recession in the US, ramping up the demand for traditional safe-havens such as the precious metal.

The 30-year T-bond yield extended its slide to a fresh record low today and caused the gap to widen while allowing gold to preserve its strength against the dollar. Reflecting the sour sentiment, major equity indexes in the US started the day in the negative territory.

However, the lack of major developments surrounding the US-China trade conflict and some positive commentary allowed risk-appetite to crawl back into the markets. "We are doing very well with China," US President Donald Trump tweeted out and a White House official told Fox Business that talks between officials had been held recently and that he was optimistic that they would reach a deal with China.

On the back of recovering sentiment, all three main indexes of Wall Street rose into the positive territory with the Dow Jones Industrial Average leading the rally with a gain of 0.7%. Meanwhile, the US Dollar Index is sticking to its daily gains near 98.20 today, keeping the bearish pressure on the pair intact.

Later in the session, participants will be paying close attention to Richmond Fed President Barkin and San Francisco Fed President Daly's speeches.

FXstreet