The gold price is making another run for the $1,300 mark in today’s trading session on the back of US dollar weakness and as the market gets ready for US President Donald Trump to meet with congress tomorrow to garner support for his tax reform package.
If Trump manages to convince congress of the benefits of his tax reform package, gold may suffer as the recent gains made have largely been in part due to the uncertainty of the tax reform.
"If we see finally some sort of movement in this area, that could reignite the trumpflation trade, risk assets could go to the races and we could see a pullback in gold as a risk hedge," said Mitsubishi analyst Jon Butler.
Also helping the gold price today was the Chinese stock market which had its biggest one day fall in nearly 2 years and left investors piling into safe haven assets such as gold.
Tomorrows testimony to congress from Jeremy Powell, Donald Trump’s pick to head the US Federal Reserve next year is likely to cause unrest in the markets and will probably lend support to the gold price until Powell’s nomination is confirmed.
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