The price of gold retains the opening range for October even though the US Dollar Index (DXY) appears to be reacting to a confluent zone of support, and the precious metal may continue to consolidate as the Federal Open Market Committee (FOMC) plans to unveil a “more explicit outcome-based forward guidance.”
In turn, the price of gold may work its way towards the monthly high ($1933) if FOMC officials show a greater willingness to further support the US economy, and key themes resulting from the COVID-19 pandemic may keep the precious metal afloat as the Fed’s balance sheet increases for the second week to approach the peak from June.
It remains to be seen if the decline from the record high ($2075) will turn out to be a change in market behavior or an exhaustion in the bullish trend as the price of gold no longer traders to fresh yearly highs during every single month in 2020, but the low interest environment along with the ballooning central bank balance sheets may continue to heighten the appeal of gold as an alternative to fiat-currencies as US lawmakers struggle to pass another round of fiscal stimulus. Read more…..
Chart of the Day
The World Economic Forum has just published its annual Report on Regional Risks for Doing Business. Not surprisingly the coronavirus pandemic has left its mark. Based on a survey of over 12,000 business leaders from 127 countries the report has unemployment top of the list, just like previous reports, like the one from the International Labour Organization, massive job losses due to the pandemic are expected to negatively impact business for the next 10 years.