Jin10 data reported on May 1st that institutional analysis pointed out that due to the easing of trade tensions and a decline in safe-haven demand, gold futures experienced a big dump. The strengthening dollar further dampened enthusiasm for gold as a safe-haven asset, making dollar-denominated commodities more expensive for international buyers. The U.S. is likely to reach a trade agreement, and market optimism and risk appetite are on the rise. However, further losses may be limited, as expectations for interest rate cuts have also been raised following the release of a series of weak economic data in the U.S., where the economy contracted by 0.3% in the first quarter. Lower interest rates typically stimulate demand for non-yielding gold.
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Easing trade tensions and declining safe-haven demand have led to a weakening of gold prices.
Jin10 data reported on May 1st that institutional analysis pointed out that due to the easing of trade tensions and a decline in safe-haven demand, gold futures experienced a big dump. The strengthening dollar further dampened enthusiasm for gold as a safe-haven asset, making dollar-denominated commodities more expensive for international buyers. The U.S. is likely to reach a trade agreement, and market optimism and risk appetite are on the rise. However, further losses may be limited, as expectations for interest rate cuts have also been raised following the release of a series of weak economic data in the U.S., where the economy contracted by 0.3% in the first quarter. Lower interest rates typically stimulate demand for non-yielding gold.