Gold strengthens over dovish testimony by Fed chief

DOVISH signals from US Federal Reserve chairman Jerome Powell bolstered bullion appeal as traders maintain bets for a quarter-basis point cut at the next Federal Open Market Committee (FOMC) meeting (July 30-31). The Fed chief spoke out on subdued economic momentum as US manufacturing Purchasing Managers' Indexes (PMIs) and inflation levels illustrate muted results (H1 2019).

The impact of trade protectionist policies has dimmed economic outlook significantly as business confidence levels remain feeble over disruptions in the global supply chain.

Rising market risks and looming US dollar weakness as such have buoyed gold prices significantly in the current term.