On Friday (January 11th), the spot gold price quickly rose in the Asian market, recovering most of the overnight decline, the latest trading above $ 1,290. During President Trump’s time, he threatened to use emergency power to bypass Congress and obtain billions of dollars in funding for the US-Mexico border. Some of the US government’s closures caused by this problem have entered the 20th day.
Trump Day flew to the US-Mexico border area of Texas to try to strengthen the rationality of building walls. Accompanied by the family members of the victims of illegal immigration crimes, as well as border patrols who did not receive pay during the government’s closure.
"If we don't have a barrier and a strong barrier, we can't solve this problem," Trump said at the briefing. Plastic-packed heroin blocks, seized guns and a plastic bag filled with cash were displayed at the venue.
Trump insisted that the end of the government's government appropriation bill must include $5.7 billion in wall funding, which is his important campaign promise. This stalemate has caused a quarter of federal agencies to close, and hundreds of thousands of federal employees have been disbursed.
Trump took the rage on the scene of the stalemate in the border wall with the leaders of the Democratic Party. He accused the Democrats of rejecting his request and saying that they are still more difficult to deal with than China. “To be honest, I found that China is much more admirable in many ways than ‘cry and crying’ Chuck and Nancy. I really think so,” Trump said. He refers to House Speaker Nancy Pelosi and Senate Democratic leader Chuck Schumer.
Trump canceled the plan to attend the Davos World Economic Forum, which opened on January 22, suggesting that he is ready to keep the government closed.
Trump said his lawyer told him that he had the right to declare a state of emergency to get funding for the wall-building project; the Democrats have said that the move may be illegal.
“I have the absolute right to declare a state of emergency,” Trump told reporters at the White House. "I am not ready to do this, but if it is necessary, I will." If Congress does not make concessions on the issue of border wall funding, Trump said he is likely to declare a state of emergency. "I will almost certainly do this," he said.
Affected by the US government’s stalemate and further fermentation, the market’s demand for gold has remained strong. Earlier, the price of gold fell briefly on Thursday, as investors cut the dollar short position and the dollar rebounded from the low.
Fed Chairman Powell said on Thursday that the Fed has the ability tocurrencyThe policy remains patient. He downplayed the importance of policymakers' expectations that the median value would raise interest rates twice this year.
"The price of gold is driven by the dollar's rise overnight. The trend between the two is usually the opposite, but overall, this will not change the technical trend of gold," U.S. Michael Matousek, head of trading at Global Investors, said. Matousek said investors are concerned about whether the price of gold will exceed the level of $ 1,300 or $ 1,275.
It is worth mentioning that Goldman Sachs raised its gold price forecast this week. It is expected that the price of gold will rise to $1,425 per ounce in the next 12 months, which will be the level not seen in more than five years.
Goldman Sachs headed by Jeffrey CurrieAnalystThe team wrote in a report: "As the Fed does not move and policy uncertainty increases, we estimate the price of gold for three months, six months and 12 months from $ 1,250 / ounce, $ 1,300 / ounce and $ 1,350. / ounces are raised to $1,325 per ounce, $1,375 per ounce and $1,425 per ounce, respectively."
SocGen strategist also released a report saying that the actual US yield and the US dollar are expected to be suppressed, and the price of gold should break through in 2019. Societe General said that the lack of safe-haven assets will also make gold stand out again, and investors should buy more gold. Societe General recommends that investors use the options market to establish positions.
(Article source: Global Forex)