What happened
Gold futures rose to US$4,445.30 an ounce on 17 August following weaker US retail sales and consumer sentiment data. Geopolitical risks intensified as transit through the Strait of Hormuz slowed dramatically, with reported daily commodity vessel passages dropping to zero on Sunday from 31 the previous weekend.
Why it matters here
Lower US retail activity dampens expectations for further Federal Reserve rate hikes, supporting non-yielding bullion. For Australian investors holding local gold equities, elevated spot prices offer cash-flow support, although broader maritime freight disruptions and rising fuel prices could elevate site-level operating expenditures for miners.
What to watch
The upcoming release of Federal Reserve meeting minutes for further indications regarding US monetary policy direction, movement in Treasury yields, and global risk sentiment.
Source
aceinvestors.com.au