Gold has posted strong gains to kick off the week. In Monday’s North American session, the spot price for one ounce of gold is $1322.50, up 0.69% on the day. The metal is currently at its highest level since the end of February. On Tuesday, the U.S. publishes building permits and CB consumer confidence.
Nervous investors is usually good news for gold, which is a safe-haven asset. Investors have been in a sour mood since the Federal Reserve policy meeting on Wednesday. The Fed has been dovish since the start of the year, but the Fed was much more dovish than expected last week. The Fed’s dot plot indicated that rate levels will remain on hold for the rest of 2019, and the Fed also lowered its growth forecast for 2019 to 2.1%, down from 2.3% in December. There was more bad news on Friday, as the spread between 3-month and 10-year Treasury notes turned negative for the first time since 2007. This is known as an inverted yield curve, which is considered a recession indicator. Stock markets dropped sharply late last week and the downward trend has continued on Monday. This has been good news for gold, which has climbed close to 1.0% since Thursday. If risk apprehension remains strong, traders can expect gold to continue to climb.
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