On Tuesday (September 15) in the Asian session, the DOLLAR index continued to bear pressure, at present near the 93 mark; Spot gold accelerated short – term gains, and briefly broke through 1965 dollars an ounce. As for the Situation between China and India, according to the latest Indian media reports, the tension in eastern Ladakh has not changed and the Indian military will maintain a high combat readiness. Geopolitical tensions continue to support gold prices. The State Council of China has released the first list of goods subject to tariffs imposed on the US, including 16 items such as prawn seeds and seedlings.
Gold briefly topped $1965
Gold rose about 1 per cent on Monday as the dollar weakened, while expectations that the US Federal Reserve will maintain its dovish monetary policy this week further strengthened the appeal of safe-haven metals. Spot gold closed Monday at $1955.20 an ounce, up 15.51 dollars, or 0.80 percent, after peaking at $1962.20 an ounce.
The U.S. dollar index.DXY continued to weaken in the Asian session on Tuesday, while spot gold accelerated in the short term, hitting as high as $1965.91 an ounce.
“Gold is rising because the dollar is under quite a bit of pressure,” said Phillip Streible, chief market strategist at Blue Line Futures.
Investors are closely watching the Federal Reserve’s policy decision later this week. The FEDERAL Open Market Committee will announce its interest rate decision at 02:00 Beijing time on Thursday. Federal Reserve Chairman Colin Powell will hold a press conference at 02:30 Beijing time on Thursday.
“The Fed is expected to maintain its inflation target, we’re going to be at 2 percent inflation for some time, they’re going to increase their quantitative easing purchases, so gold will remain supportive on that basis,” Streible said.
Td commodity analysts said they expected the Fed to continue to reiterate its ultra-loose stance. Td analysts said in a note on Friday: “We expect this week’s FOMC to clear a second hurdle for gold bulls, as officials should send dovish signals through the language on QE, the extension of the dot plot to 2023 and the chairman’s press conference.”
James Steel, chief precious metals analyst at HSBC, said: “Real interest rates will remain negative. In the current low interest rate environment, holding non-yielding assets such as gold becomes more attractive.”
Meanwhile, the European Union has stepped up pressure on British Prime Minister Boris Johnson to abandon efforts to break the brexit treaty.
Jeffrey Christian, managing partner at CPM Group, said gold prices would continue to rise due to political uncertainty in the United States, Brexit and weakness in the overall global economy.
With uncertainty over Brexit trade talks and U.S. stock valuations in doubt, this could mean near-term global risk asset performance will come under pressure, which could be positive for gold, credit Agricolor said.
Once the first target of $1967.90 is breached, gold’s next target will be $2008.80, according to an article published on Tuesday by Economies.com. Maintaining gold above $1,934.86 an ounce is important for continued bullish expectations.
Analysts and traders are uniformly bullish on gold’s outlook for the week, according to the WEEKLY FX168 Financial Market Survey released on Saturday. Among traders and analysts surveyed weekly by financial markets, 80 per cent were bullish on gold and 20 per cent were consolidation.
Kitco’s latest gold survey on Friday showed a surge in bullish sentiment among retail investors as the metal’s trading range continued to narrow. Retail investor confidence rose to its highest level in a month. A total of 1,359 people took part in the online survey. Of those surveyed, 926, or 68 per cent, expected gold prices to rise this week. Another 205 (15 per cent) said they expected gold prices to fall, while 228 (17 per cent) were neutral.
Charlie Nedoss, senior market strategist at LaSalle Futures Group in New York, said while gold looks technically expensive, he is optimistic the price will rebound this week.
The tension in eastern Ladakh has not changed the Indian military will maintain a high level of combat readiness
Four days after the Indian and Chinese foreign ministers reached a five-point agreement on resolving the long-standing border deadlock, the overall situation at the friction point in eastern Ladakh remains unchanged and the situation remains tense, according to government sources, India TV reported on Tuesday. According to sources, both Indian and Chinese forces are holding their respective positions along the Line of Actual Control (LAC).
Sources told Press Trust of India (PTI) that the Indian army will not let down its guard and will maintain its current high level of combat readiness in eastern Ladakh until there is a significant change in the situation on the ground.
Indian Foreign Minister Sushma Jaishankar and Chinese Foreign Minister Wang Yi reached an agreement on resolving their border dispute last Thursday during a meeting in Moscow on the sidelines of the Shanghai Cooperation Organization (SCO). The agreement includes measures such as rapid disengagement of forces, avoidance of actions that could escalate tensions, compliance with all agreements and agreements on border management and steps to restore peace along the LINE of Actual Control.
The agreement also said the two sides should speed up work to conclude “new confidence-building measures” to strengthen peace and tranquility in the border areas. But it did not mention any timetable for military disengagement.
NDTV reported on Friday that sources said India was “strongly concerned about the build-up of Chinese troops along the LAC” during a meeting in Moscow last Thursday evening local time between Indian Foreign Minister Sushil Jaishankar and Chinese Foreign Minister Wang Yi.
India’s Foreign ministry released a joint statement on Friday that contained five points agreed by the two sides in “frank and constructive” discussions. “The two foreign ministers agreed that the current situation in the border area is not in the interests of both sides,” the statement said. They therefore agreed that the border forces of the two sides should continue their dialogue, quickly disengage, maintain appropriate distance and de-escalate tensions.
According to the website of the Embassy of the People’s Republic of China in India on September 14, Ambassador Sun Weidong made remarks on recent media inquiries and bilateral meetings between Chinese and Indian foreign ministers. Referring to the consensus reached in previous meetings between the two leaders, Sun weidong said the two sides should “pursue win-win cooperation” rather than a “zero-sum game”.
Wei-dong sun pointed out that the five consensus that meetings with the foreign ministers of India and China, including insists on the leaders of the two countries consensus, ease in situ situation, maintain peace and tranquility along the border, keep clear of foreign communication, accelerate to establish a new trust measures, are both important steps towards the right direction, to ease the border situation, promote the political impetus for the development of bilateral relations.
“I have noted that Indian public opinion generally speaks positively of the five-point consensus and believes that both sides have demonstrated political will to resolve the border situation,” he said. I hope and believe that as long as the two sides earnestly implement the consensus reached by the foreign ministers of the two countries and apply it to the front-line forces, and stick to the right way of dialogue and negotiation, the two sides can find a way to overcome the current difficulties.”
Beijing: Chinese troops are laying a network of fibre-optic cables at a flashpoint with India in the western Himalayas, two Indian officials said on Tuesday, Reuters reported. A senior government official said the cables, which were recently discovered in the southern Part of Pangong Lake in the Ladakh region of the Himalayas, would provide frontline troops with secure communications lines to rear bases.
The Indian army and the People’s Liberation Army (PLA) have been locked in a standoff near the Line of Actual Control (LAC) in eastern Ladakh since early May. Both countries blame the other for exacerbating the impasse.