Gold jumped from yesterday's two-week low, hitting above $ 1,550 / ounce on the second day of stock markets down, in the MSCI index.
Rates of major Bonds declined, while crude oil raised its head after the three-week low.
Yesterday's data showed that US inflation for 2019 was 2.3% per year excluding food and fuel, therefore without changes from 2018. Subsequently, the data showed a slowdown in UK inflation to 1.8%, the French one 1.8% and the Spanish one 0.8% per year
Germany will provide a reading of its core inflation tomorrow, but has already indicated that its GDP increased by 0.6% in real terms in 2019. China, whose inflation reached its seven-year peak in 2019, increased by swine flu will indicate GDP estimates on Friday.
"The major central banks will no longer attempt to normalize interest rates," Greg Jensen told the Financial Times today .
For gold "this is a decisive factor," says Jensen, estimating an increase to $ 2,000 / ounce and indicating to investors "to put gold at the base of their portfolio", because with the geopolitical tensions on the rise, and with the leap in American assets that will fade after a decade of hikes, "the Fed will not take action to prevent hyperinflation."
This would cut real rates, which are a fundamental driver of the gold price.
By cutting rates three times in 2019, despite stable inflation, Fed President Powell indicated that "to raise rates, I would like to see persistent and significant inflation first."
With gold peaking at seven years in January 2020, and peaks in many other currencies, a note from the UBS bank indicates that "sales by mining producers should keep the price of gold in check ", but "not we expect they will be able to deflect the basic macro upside factors ", such as negative interest rates, a falling dollar and geopolitical tensions that continue to support the price.
"Furthermore, the less promising American economic data will support gold."
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