Gold price gains some positive traction on Friday and for now, seems to have snapped a four-day losing streak to its lowest level since March 13, arou
nd the $1,885 region touched the previous day. The XAU/USD maintains its bid tone through the early part of the European session and currently trades just above the $1,890 level, up around 0.30% for the day. The intraday uptick, however, lacks bullish conviction, warranting some caution before positioning for any meaningful recovery move.
China Evergrande Group – one of the country's biggest real estate developers – has filed for protection from creditors in a US bankruptcy court. This adds to concerns about a deepening crisis in China's property sector and the worsening conditions in the world's second-largest economy, which forces investors to take refuge in traditional safe-haven assets.
In fact, the yield on the benchmark 10-year US government bond corrects sharply from a 10-month peak touched the previous day, though the prospects for further policy tightening by the Federal Reserve should help limit the downside. In fact, the minutes of the last Federal Open Market Committee meeting held on July 25-26 supported prospects for higher-for-longer interestin the United States and kept the door open for one more 25 basis point lift-off later this year.
Moreover, the incoming US macro data continues to point to an extremely resilient economy, which should allow the Fed to stick to its hawkish stance. This, in turn, assists the US Dollar to stand tall near its highest level in more than two months and further contributes to keeping a lid on the Gold price.
Traders also seem reluctant and might now prefer to move to the sidelines ahead of the crucial Jackson Hole Symposium next week, where comments by central bankers might infuse significant
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