The US – China war has been making noises in the financial market. Both countries have been planning to impose additional tariffs on their respective exports. One of the consequences this war brought about was certain movements in the market, including the commodities.
Gold Considered As A ‘Safe Haven’
Gold, or as investors hail as the “safe haven”, has been rallying for the past six years. The rally continued to happen this week as the US and China dispute, became more controversial and heated. As the first imposition of US tariffs happened in Sunday, the precious metal hit a higher marginal value.
Federal Reserve Bank, by mid-week, released announcement of recession fears and this is going globally. This drove investors in fear of other assets and turning again to their safe haven. As a result, Gold reached its highest level on this day since February 2013.
On the last day of the week, a chance to have a peaceful trade talks between the US President Trump and the President of China Xi Jinping. This news of course, led the investors away from the yellow metal which caused it to dive and a chance for other assets to get back up.
Flowing Gold Feared To Be Weakened
The United States of America and China are known to be two of the world’s largest economies, as well as crude oil producers. As the market opened in Monday, this flowing gold’s weakened due to the fear of global growth and higher demand for crude oil.
As the week goes on, China started to impose their 5% tariff addition to US’ crude oil. According to analysts, this is even the first time that this asset was aimed and nudged by both countries. This also resulted to the continuous cut down of drilling rigs since January.
On Wednesday, after two days of diving, oil prices found their way back up. This is because China has already positive results regarding their economic status. From this day on, the price of oil continued to just move sideways.
As the Non-Farm payroll is about to happen, what is in store for our commodities market? Will the gold be able to get back up? Will the oil continue to move sideways or slump again?
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