Gold Price Subdued Despite Dollar Weakness

New York (Sept 21)  Gold prices were subdued on Friday to hover below a one-week high even as the dollar weakened against most of its rivals on receding fears of full-blown China-US trade war.

Markets veered around to the view that the US-China trade row would be less harmful to global growth than first feared.

The dollar's weakness also comes amid expectations that Beijing would increase economic stimulus to boost the economy in the face of the trade war.

Spot gold was marginally lower at USD1,205.17 but remained on track for a gain of more than 1% this week. US gold futures were down 0.13% at USD1,209.80 an ounce.

Investors have been buying the dollar recently on expectations that the tariffs will improve trade balance in the US However, with trade war concerns ebbing somewhat, the dollar is now set for its biggest weekly drop in 7 months.

The Federal Reserve gathers next week, with economists expecting the central bank to raise benchmark interest rates by 25 bps.

Meanwhile, with trade uncertainties looming and a US midterm election approaching, there are some underlying questions over where interest rates will go in the future.

AllianceNews

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