Gold has dropped to $1,825. Still, economists at Commerzbank expect the yellow metal to hold above the $1,800 level.
Gold not solid as a rock
“Gold has failed repeatedly in recent weeks to live up to its reputation as a safe haven, despite recession fears being behind the price slide suffered by cyclical commodities.”
“Over the past few weeks, increased buying interest could be observed at prices just above the $1,800 mark – preventing the gold price from dipping below this threshold in any lasting manner. We expect much the same to happen this time, too, and do not envisage any more pronounced decline in the gold price.”
“Inflation will be the main topic today at Fed Chair Powell’s semi-annual testimony before the US Senate Banking Committee. If the market learns anything new from the testimony, this is also likely to have an impact on gold via movements in the EUR/USD and bond yields.”