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XAU/USD GOLD – US China Talks Report Unlocks Risk Aversion

Gold rose on Wednesday after a posible meeting between the US and China to discuss trade was reported to be planned by US Treasury Sec Mnuchin. Trade war tensions have pressured the yellow metal making the US the most desired destination. Signs of goodwill form the US unlocked risk appetite and investors are taking gold to $1,207.

Gold is still sensitive to geopolitical factors. The economic calendar will bring inflation data in the US to the forefront. A higher inflation scenario could lock in two rates hikes for the U.S. Federal Reserve and keep gold in the current tight range. A solid CPI number in the States and the beating of the trade war drums are the worst case scenario for commodities this week.

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Alfonso Esparza

Alfonso Esparza [5]

Senior Currency Analyst at Market Pulse [6]
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza