What goes up must come down and that has been true of the gold price so far this week. But how far is up, and how much is down, are impossible to know right now when it comes to gold. There are plenty of price-supportive background noises however.
Gold approached its 25-year high in pounds sterling (1194.87) early in the week and moved to £1128.70 and $1439.21 on 25 June, following strong indications by Jay Powell, chairman of the US Federal Reserve, that he is minded to cut interest rates.
In the US the Federal Reserve is coming under considerable pressure from President Trump to cut rates. Powell said to reporters that “an ounce of prevention is worth more than a pound of cure,” an enigmatic saying that gave everyone to understand that a rate cut is on the cards. Other supportive factors for the gold price naturally include the increasingly belligerent stand-off between the US and Iran, and the on-going trade battles between China and the US.
In sterling terms, gold is rallying in the context of 31 October, the date set by Boris Johnson – expected to be the next leader of the Conservative party and also the successor to Theresa May as British Prime Minister – for the UK to leave the European Union. Johnson has promised the UK will leave, deal or no deal – the hardest line drawn by anyone so far. Everyone – including Johnson – says they don’t want a no-deal Brexit: but the possibility of that actually happening has got everyone jittery, and had helped the gold price to shift into a different gear. It now looks like gold is having a breather, rather like a marathon runner taking the mid-section of a race easier. Whether the marathon runner will speed up again or not is, or course, an open question.
Either way its time to download Glint and start buying, saving, and spending gold.