Gold Prices May Fall Further as US Dollar Recovery Continues

GOLD CRUDE OIL TALKING POINTS:

  • Gold prices sink as the US Dollar deftly juggles haven-, yield-based appeal
  • Crude oil prices bounce as OPEC+ officials hint at new output cuts in 2019
  • SP 500 futures hint at risk-on bias, Adipec chatter may be market-moving

Gold prices fell even as bond yields tracked stocks lower and the priced-in rate hike path implied in Fed Funds futures flattened Friday. The US Dollar found renewed haven appeal against the risk-off backdrop, and its rise undermined the appeal of anti-fiat alternatives epitomized by the yellow metal.

Crude oil prices also tracked lower, succumbing to de-facto selling pressure because they are denominated in USD terms on global markets. A spirited recovery has been triggered over the weekend however – producing an upward gap at Monday’s trading open – after OPEC+ officials worried aloud about oversupply in 2019.

Markets seemed to read that as signaling that the cartel and like-minded producers – notably, Russia – may cut output quotas once again having raised earlier this year. That was meant to cushion the blow from the sidelining of shipments from Iran after the re-imposition of US sanctions.

Article source: https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/commodities/2018/11/12/Gold-Prices-May-Fall-Further-as-US-Dollar-Recovery-Continues.html