Risk-off appetites bolster safe haven assets

GOLD prices notched a two-week high as risk sentiments diminished over global growth concerns. President Donald Trump has vowed to impose trade tariffs on Mexican imports in response to US-Mexico migration issues. The latest salvo by the Trump administration weakened risk appetites as investors deliberate the impact of US trade protectionism on the global economy. A contraction in Chinese PMI figures along with shrinking industrial profits have bolstered bullion appeal as markets seek safe haven shelter over growing market risks. Looming economic uncertainties will cement support levels for the precious metal in the near term.

What should investors look out for in the longer term?

Risk sentiments have struggled to gain a firm footing as investors turn pessimistic over rising economic uncertainties. Trade protectionist policies from the United States against its global neighbours have heightened growth fears while extending bearish pressure towards risk assets. Rising market risks from a prolonged Sino-US trade dispute and flagging economic growth will draw support for safe haven assets as market confidence recedes. We continue to assess range-bound conditions for gold however as investors balance between global economic fears and a resilient US dollar for the current term.