- Gold bears back in control amid a rebound in the US Treasury yields.
- US-China trade pessimism could cap the downside ahead of Powell’s speech.
Gold holds the lower ground in the mid-European trading, having refreshed daily lows near 1497 levels, mainly driven by a rebound in the US Treasury yields across the curve.
Markets are resorting to profit-taking following Friday’s mixed US jobs report-led sell-off in the Treasury yields, as attention now turns towards the US Federal Reserve (Fed) President Powell’s speech, due at 1700 GMT, for any fresh hints on the US interest rates outlook.
US-China trade updates in focus
Despite the latest leg down in the yellow metal, the buyers continue to derive support from the recent US-China trade-negative headlines that weighed negatively on the risk sentiment and put a bid under the safe-havens earlier this Monday. Bloomberg reports that China is likely to offer a limited scope on the trade talks when the US and China trade teams meet this Thursday for high-level talks in Washington.
Further, persisting weakness in the US dollar across its main competitors, in the facing of growing US recession risks, also helps keep the downside cushioned in gold. Looking ahead, the US-China trade developments will likely emerge as the main driver for the traditional safe-haven gold amid a lack of significant macro data this week.
Gold Technical levels to watch
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