As reported by Bloomberg, fund managers are cautioning against hoping that the US mid-term elections, which drop late Tuesday, could see a revival spark in Gold prices.
Key highlights
According to Franklin Templeton Investment’s Stephen Land, concerns that the US Federal Reserve will pick up their pace of rate hikes will far overshadow any short-term action from the US midterm elections, and Land is warning that the Greenback and US-China relations are here to stay as Gold catalysts.
Gold’s rally that started last week, causing the metal to post its first gainer month since March, ended prematurely last week at the hands of a resilient US Dollar, and Stephen Land notes that the election has no room to become a key driver for Gold: “It’s the outcome of the potential trade war with China, the overall health of the Chinese economy and the Fed actions and how that relates to the U.S. and the strength of the dollar.”
“Goldman Sachs Group Inc. said it sees a divided Congress as the most likely outcome of the midterm elections, with Democrats taking the House of Representatives and Republicans keeping a slim majority in the Senate. Luc Luyet, currency strategist at Pictet Wealth Management, says the likely “gridlock” scenario in the U.S. congress may mean the status quo continues and gold remains in a lull.” – Bloomberg
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