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A driver for gold is found

Olymp Trade

Gold futures broke the key level of $1295/oz at the end of last week. After a retest of the $1300 mark the upward movement continued. Today, the metal has updated the semi-annual high at around $1314. Gold is quite likely to rise in price a bit more, however, the strength of the trend is clearly exhausted and a correction suggests itself.

A new round of trade negotiations between the US and Chin is going to be the main driver for gold before the end of this week and in the beginning of the next one. Today, Chinese Vice Premier will meet US government officials, including US President. The Huawei issue is still quite acute, but the parties plan to have reached a deal by March 1.

Another important factor for gold is the interest rate decision by the US Federal Reserve. Analysts expect dovish rhetoric and the same key rate at 2.25%-2.5%.

Although it is possible that the growth factor for gold does not have a direct link with politics. Thomson Reuters GFMS analysts estimated that in the 4th quarter of 2018, the world gold supply market fell by 1% to 1082 thousand tonnes. According to their report, the demand for gold has increased by 9% to 1162 thousand tonnes over this period. And net purchases be central banks almost doubled and amounted to 196 tonnes.

Olymp Trade Review

Source: https://olymptrade.com/
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