Gold drops under $1,540 amid global central bankers’ play, BOJ in spotlight
- Gold prices remain on the back foot as global central bankers fight hard against coronavirus.
- After Fed and RBNZ, BOJ announced a surprise emergency meeting at 03:00 GMT.
- EU Finance ministers, G7 are in the pipeline as well.
With the global central bankers running the show, led by Fed and RBNZ, Gold prices decline to $1,533 by the press time of early Monday.
While the Fed’s second rate cut in the month, the first one by the RBNZ so far, triggered the initial pullback in the yellow metal, BOJ’s announcement of the emergency meeting seems to trigger the latest recovery. Additionally, RBA also crossed wires recently while saying to take further steps on Thursday.
Following the BOJ, European Finance Ministers are up for a meeting whereas the Group of Seven (G7) will also hold a teleconference to address the pandemic.
Coronavirus (COVID-19) has been weighing on the market’s trade sentiment off-late, pushing investors away from trading/investment. The latest updates from Italy and France have been worrisome while those from China keep stepping back.
The market’s risk-tone remains under pressure with the US equity futures and 10-year treasury yields down. However, Japan’s NIKKEI seems to retrace the early-day losses ahead of the BOJ.
Given the central bankers’ play in the spotlight, any more announcements/surprises will be taken seriously for near-term trade direction. It should, however, be noted that coronavirus updates will also keep their importance in the meantime.
Technical Analysis
Unless providing a daily close below 200-day SMA, currently around $1,499.50, gold prices are less likely to lose hopes to revisit $1,600.