Gold Price News: Gold Steadies After Monday’s Fall

Gold prices were broadly steady on Tuesday, as the markets consolidated after Monday’s sharp drop.

Prices moved in a range of $2,606 to $2,644 an ounce on Tuesday, showing a much more stable pattern, compared with Monday’s hefty drop from as high as $2,719 an ounce.

The weakness at the start of the week came as stock markets were in a bullish mood, recovering from a bout of softness in mid-November. A recovery in higher-risk assets tends to put downward pressure on safe-havens like gold.

Geopolitical risk eases

Gold prices have also come under downward pressure as the geopolitical risk environment appeared to cool after the Israeli security cabinet voted in favour of a ceasefire deal to end fighting with Lebanese militant group Hezbollah, according to news reports on Tuesday. However, the situation continues to carry risk, and it remains to be seen if any talks can bring a permanent end to the hostilities.

Market positioning

Investment flows into gold-backed ETFs were more balanced in recent days, following signs of falling interest in late October and early November. North America saw inflows of 10.8 tonnes in the week to November 22^nd while Europe saw outflows of 7.1 tonnes, according to World Gold Council data: Gold ETF: Stock, Holdings and Flows | World Gold Council. That compared with the previous week which saw total net outflows of 23.6 tonnes.

Upcoming events

Looking ahead, the markets will be watching out for Wednesday’s US initial jobless claims figures for the week ending November 23^rd for an update on the US labour market. At the same time, there will be updates on the monthly US PCE price index and US durable goods orders, both for October, as well as the US GDP growth rate for Q3, for the latest status update on the US economy.