Gold clocks 8-month highs, nears $ 1315 ahead of Fed, US-China trade talks

• US-China trade worries, Fed pause risks underpin the sentiment around the safe-haven.
• SPDR Gold holdings rise to highest since June
• Focus on FOMC decision and Thursday’s US-China trade talks for next direction.

The buying interest around gold (futures on Comex) remains unabated, with the rates now printing fresh eight-month peaks near 1312 levels.

Following the overnight consolidative mode, as the bulls regained poise and stormed higher heading into the key FOMC interest rates decision due later today at 1900 GMT. The yellow metal rose to the highest levels since May 2018, as the renewed doubts over the US-China trade resolution amid charges against China’s Huawei further boosted the safe-haven bids for gold. Investors fear the charges could complicate high-level US-China trade talks set to begin later on Wednesday.

Meanwhile, gold prices continue to derive support from the expectations of a dovish FOMC monetary statement, as markets fret that the Fed will pause its policy normalization sooner than expected. More so, in evidence of increased investors’ confidence in gold, Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.73% to 815.64 tonnes on Monday, their highest since June 2018.

Looking ahead, the broader market sentiment will continue to play a key role in gold trades until the announcement of the FOMC decision.

Gold Technical Levels