Gold price and stock markets react to Fed – Economic data in focus

Ein Barren Gold

The Gold price showed weakness until yesterday morning, parallel to the stock market. Mainly due to the pessimistic economic statements by the Federal Reserve last Wednesday, stock markets had been falling for days and the Gold price could profit as a “stronghold of safety”. But recently, both fell parallel to each other (read more here). But then yesterday the turnaround. The stock market began to turn upward.

Fed brings Stocks and Gold up

Then last night the Fed made another push with the news that it will buy corporate bonds. So it directly supports the US corporations. This made the stock market happy, and from 8 pm the Dow 30 jumped quickly by 300 points. Also after that, it went well up until this morning. And also the Gold price jumped up quickly yesterday evening from 8 pm onwards, namely from $ 1,722 to $ 1,728. Because even more money printing fundamentally causes even more loss of confidence in the paper money system. The danger of inflation increases etc. Gold can hold overnight at $1,725. A real rally looks different!

Economic data

But today there can be a lot going on in the price of Gold. The ZEW Index was be published in Germany at 11 a.m. It is also respected worldwide. At 2:30 p.m. retail sales for May were published in the USA. This is an extremely important figure, because the US economy is based on consumption by its citizens and not on exports as in Germany. Then at 3:15 p.m., there are US industrial production data for May. All three numbers can move stock prices as well as the price of Gold.

For some time now, one can have the impression that Gold wants to break out upwards. Just what is the precious metal waiting for? Are there any triggers for new climbs today? We’ll see. If there is no negative economic data today, and stock prices continue to rise thanks to yesterday’s Fed message, this renewed appetite for risky assets could prevent a rise in the price of Gold.

Der Chart zeigt den Verlauf im Goldpreis in den letzten 30 Tagen
Gold price over the last 30 days
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