31.05.2016 - The price of gold rebounded after sharp fall
The price of gold has corrected up amid the weakening of the US dollar after its recent strengthening. In addition, investors fixed positions in connection with reaching the psychologically important mark of 1200 dollars per troy ounce. Trading volumes were lower yesterday due to holidays in the UK and the US. It is worth noting that in the near future on the gold price will pressure the expectations of Fed interest rates hike this summer, which traditionally has a negative impact on the dynamics of the gold, which will become less attractive compared with the assets that generate interest income. On the other hand in the near future there is a high probability of falling stock markets, which will increase the demand for defensive assets such as gold. In this regard, we keep a medium-term negative outlook, but do not rule out raising the price of gold in the near future.
The price of Light Sweet crude oil is consolidated around the level of 50 dollars per barrel in anticipation of the results of OPEC meeting on 2 June. According to our estimates, the cartel participants will not reach a consensus on the issue of limiting oil supplies to deal with oversupply in the market. Investors are also waiting for the news on American inventories and production of oil, which will be published tomorrow. A more likely scenario in the coming weeks, according to our forecast will be a significant price correction by 15-20%, after rising by 80% from the middle of February.