Fundamentals:
Aside from the U.S. dollar and equities,the chatter around the future of Fed rate hikes as the top drivers of gold next week
Markets believe that FED officials may revert to a “wait-and-see” approach after proceeding with another rate hike this month.
Under the evolving “data dependent” strategy, the Fed could step back from the predictable path of quarterly hikes it has been on for most of the past two years, raising the possibility it might delay rate hikes at some upcoming meetings, according to recent interviews and statements,
Next week, the markets are likely to continue digesting the soft U.S. employment figures, which showed that the economy only added 155,000 new positions versus the expected 200,000. However; the headline number was a bit weaker than expected , but generally it still points to an economy that is in a fairly healthy shape.There are no signs yet of a severe slowdown. The unemployment rate is still at a 49-year low of 3.7%
After nearing a five-month high on Friday, gold bulls are optimistic that positive momentum will be carried through to next week as markets scour for hints as to the Federal Reserve’s future monetary policy outlook.
Additionally, the markets hope that the supply-demand fundamentals are turning in favor of commodities for 2019, especially the metals. Palladium, Silver and Platinum can be considered as commodities since they have industrial use.The question is whether Gold would be able to take the advantage – or not – being a commodity without a significant industrial use ? I am not sure. I am insisting on to invest in Palladium and published few articles. I will update my Palladium forecast. Our main subject is Gold in this article.
Another issue is that Market participants continue to focus on genuine concerns over the current trade war between the United States and China and its effect on the global economy at large.
Another development worth watching for gold investors next week is the UK Parliament vote on Brexit this Tuesday. Some Gold investors think that Prime Minister Theresa May’s plan to leave the EU is rejected by British lawmakers, it could mean more political chaos. And Gold will raise a safe haven.
That is true and I agree. In 2016, Brexit helped gold. And if this deal with the EU is voted down in the UK, that does open up all sorts of political uncertainty and we might see UK investors move into gold as a safe-haven
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