Price of Gold Fundamental Daily Forecast – Mixed Fundamentals Holding Gold in Trading Range

Gold futures are trading flat to lower on Friday as investors digest the latest developments over Brexit and disappointing economic data from China and the United States.

The market is being capped by the hopes that a Brexit deal between Britain and the European Union could prevent an economic recession in the Euro Zone.Meanwhile, it’s also being underpinned by weaker economic data from China and the United States that highlights the damaging effects of the prolonged trade war between the two economic powerhouses.

At 13:29 GMT, December Comex gold is trading $1494.00, down $4.30 or -0.29%.

Gold Capped by Brexit Optimism

Hopes over a Brexit deal are helping to put a lid on gold prices on Friday. However, the selling pressure is weak since there is still risk surrounding the necessary agreement between the United Kingdom and European Union, which needs to be approved by the U.K. parliament.

“At the moment, the parliamentary arithmetic is somewhere between “extremely tight” and ‘no’” said Constantine Fraser, a political analyst at TS Lombard. But the “main takeaway is that the Conservative party is now committed to this deal, not no-deal, and will campaign for a majority for it.”

Weak U.S. Economic Data Raises Chances of Fed Rate Cut

While most of the world was focused on Brexit and the progress of U.S.-China trade talks on Thursday, the U.S. released a number of economic data reports, ahead of speeches from a pair of Federal Open Market Committee members.

On Thursday, the Philadelphia Fed Manufacturing Index, Housing Starts, Industrial Production and Capacity Utilization, all came in below expectations.

China Releases Third-Quarter GDP Figures

China released third-quarter GDP figures on Friday showing the economy grew 6.0% from a year ago. This was weaker than analyst expectations for a 6.1% gain. Beijing’s protracted trade dispute with the U.S. has weighed on its economy, with growth slowing to 6.2% in the last quarter, its slowest pace in 27 years.

Lack of Clarity over U.S-China Trade Deal Progress Supportive

China emphasized Thursday that the U.S. must remove tariffs in order for the two countries to reach a final agreement on trade, Ministry of Commerce spokesman Gao Feng said.

“We hope both sides can continue to work together to advance the negotiations and, as soon as possible, reach a phased agreement and make new progress on canceling tariffs,” Gao said.

Daily Forecast

Mixed fundamentals and low volume could help hold gold in a trading range on Friday. Putting a cap on gains is optimism over Brexit. Underpinning gold are worries over U.S.-China trade relations and the chance of a Fed rate cut at the end of October.

As of Thursday’s close, the CME Fed Watch Tool estimates the chances of a Fed rate cut at the end of the month at 85.0%.