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Jackson Hole meeting keeps gold on hold ahead of potential rally

Jackson Hole

A stronger dollar and a wait-and-see approach ahead of Thursday’s monetary policy makers’ meeting in Jackson Hole has seen the gold price drop slightly. This morning gold was at $1,285.72, while gold for December delivery was at $1,289.10.

European Central Bank chair Mario Draghi and Federal Reserve chair Janet Yellen are both set to speak at the conference in Wyoming, later this week – although the Bank of England’s Mark Carney will not attend. The meeting looks set to impact the gold price as it may set the tone for interest rates going forward.

Additionally, security concerns could potentially push gold up as war games being held by South Korea and the US may provoke a reaction from North Korea. “Geopolitics are still flashing on trader dashboards and they remain risk-averse,” Naeem Aslam, chief market analyst at Think Markets told Reuters. “The Jackson Hole meeting is the chief event for this, and it is pretty much safe to say that we are very dubious about getting anything new from the meeting, but traders still want to hedge their risk ahead of any unexpected outcome.”

Aslam went on to say that anything unexpected coming from the meeting would led to a “mammoth” move in the gold price. Elsewhere speculators picked up on oil’s inverse climbdown against the gold price. Matt Maley of equity strategist Miller Tabak & Co, told clients: “Gold has rallied during the recent market setback and is now testing its key resistance level of $1,300, that is the level that stopped rallies in both April and June, so if it can finally break above the level in any significant way, it’s going to be very positive for the yellow metal.”

Elsewhere though, investors believe this current round of interest is cooling. Natixis analyst Bernard Dahdah told The Financial Times: “A lot of the driver of the price of gold has been geopolitics which we haven’t seen in years. It’s hard to see gold above $1,300 with current conditions. You’d need much more disappointing data from the US for it to stay above these levels.”

Suki Cooper, an analyst at Standard Chartered in New York, echoed that sentiment, telling the same paper “usually when gold has its strongest rallies, it’s when we see broader investor interest, we haven’t seen that in play at the moment”.

Photo: Grand Teton National Park, just north of Jackson Hole. Credit: Jeff Gun

Link to this article: : http://www.goldmadesimplenews.com/gold/jackson-hole-meeting-keeps-gold-on-hold-ahead-of-potential-rally-13357/

Posted by on Aug 22 2017. Filed under Gold News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

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