Euro v US – what’s in store for gold?
As we discussed yesterday, tonight the ECB is widely expected to cut interest rates, including going negative on deposit rates, and possibly start printing money. Short term this could see the Euro drop and USD strengthen which may be negative for gold prices. Many however think that Draghi has talked it up so much that it is all priced in already.
That leaves the US NFP employment data on Friday which again many are predicting will disappoint in real terms but maybe ‘look good’ enough for the bullion banks to short the price down further. Both however talk to much deeper problems that are bullish for gold in the medium term. The short term price discount might just be seen as good buying on ‘sale’.