Gold: A shaky September - HSBC

Gold seesawed in September, rising to a high of USD1,358/oz on 8 September before sliding back down to USD1,280/oz at the end of the month, notes the analysis team at HSBC.

Key Quotes

“The yellow metal continued to track tensions between the US and North Korea, with rising geopolitical risk in the first week of September helping the rally to a 13-month high on 8 September. When North Korea chose not to launch a missile to celebrate its Founding Day on 9 September, this risk began to subside and gold opened USD10/oz lower on 11 September. As the markets regained some risk appetite, the price of bullion fell back towards USD1,300/oz with only short-lived strength in response to geopolitical news, such as a North Korean launched missile fired over Japan on 15 September.”

“The USD rally after the FOMC decision and ‘dots’ release on 20 September saw the price of gold fall immediately against the greenback, dipping below USD1,300/oz. The precious metal temporarily bounced back above this level as the North Korean foreign minister stated that some of Trump’s online comments amounted to a declaration of war, but this was not sustained. The gold price continued its downward trend as the Fed signalled it is still on course for tightening and Trump proposed a corporation tax cut. Bullion ended the month down 2.8%.”