29.08.2014 - The situation in the east of Ukraine continues to raise the demand for gold
The price of gold continued to rise yesterday, on the background of the deteriorating situation in Ukraine. Despite this demand for gold fell after publication of data on US GDP growth in the second quarter by 4.2%, which is 0.3% better than expected. Gold demand of investment funds remains weak. On the markets of Asia rise in demand is expected in India in connection with waiting of the wedding season. Let us remind that earlier India was the world's largest consumer of gold, but lost first place to China. Further movement of the price of gold will depend on the development of the situation in the East of Ukraine and possible sanctions against Russia. We maintain our positive medium-term outlook for gold in the expectation of correction in the stock markets.
Oil prices rose yesterday despite weak demand on the market. The reason for optimism have become positive data on GDP growth in the United States by 4.2% in the second quarter, compared with an expected growth of 3.9%. In addition, the Ukrainian president stated about the invasion of Russian troops on the territory of Ukraine and urged the international community for help. The escalation of conflict in the region may lead to new sanctions against Russia and supply disruptions of oil and gas to Europe. Today, in the center of the attention of traders will be data on the unemployment rate in the Eurozone (09:00 GMT) and the index of consumer confidence in the United States (13:55 GMT). We maintain a medium-term negative outlook, but recommended to follow the geopolitical news.