The gold market once surged to above the level of $1235 per ounce under the uncertainty of this week, but in the case of risk aversion, the price of gold fell back to near $1,220 per ounce.
Quite a lotAnalystIt is believed that this week's US mid-term elections are unlikely to have much impact on the US economy, so it is difficult to push the price of gold higher.
Jameel Ahmad, head of global currency strategy and market research at FXTM, said that the US dollar is too high and it is hard to say how its uptrend will be affected.
The short-term dollar is indeed under pressure, but it is hard to say whether this will be sustained. Investors will see some changes in the fundamentals of the market, and the dollar may fall in the long run.
Currency analysts at Brown Brothers Harriman (BBH) believe that the weakening of the dollar will only be short-term.
Salaries and prices will continue to rise, allowing the Fed to raise interest rates again in December and raise interest rates three times next year.
This will be a big bad for gold.
SIA Wealth Management Chiefmarketing strategyColin Cieszynski believes that there will be more uncertainty after the mid-term elections, but this does not mean a big profit for gold. However, in the case of higher inflation, the price of gold will rise.
Commodity prices are rising, wages are rising, and rising inflation will provide a very important bottom support for gold.
But Gold Newsletter editor Brien Lundin believes that the US fiscal deficit will become higher in the future and the debt burden will become even greater.
Ininterest rateIf the dollar rises and the dollar does not depreciate significantly, the cost of debt will reach an uncontrollable level. I think that smart money will be aware of this problem and will not bet on the dollar.
Baoshengbank(Julius Baer) Commodity research analyst Carsten Menke pointed out that the uncertainty of the US political situation will not promote gold.
In the mid-term elections in 2010, the two parties in the United States also took control of the two houses. In the second half of the year, the price of gold rose by 20%, mainly due to the weakening of the US dollar and the Fed's easing policy. But now, the Fed is beginning to tighten its policy, and the dollar has risen 4% so far this year.
However, Menke believes that in the long-term trend, gold is picking up, and the normalization of market sentiment will also promote short-term gains.
The second phase begins next year, the dollar will change, and in the third phase, the market will increase.Long andInflation concerns will enter the market and promote the safe-haven demand for gold.
(Article source: Gold headline)