Price of Gold Fundamental Daily Forecast – Fears of Global Economic Slowdown, Middle East Tensions Supportive

Gold futures are edging lower on Tuesday, but the market remains underpinned by fears of a global economic slowdown and lingering tensions in the Middle East. In the meantime, traders are going to have to sit for about two weeks before getting progress reports on the scheduled high level trade talks between the United States and China.

At 10:33 GMT, December Comex gold futures are trading $1528.90, down $2.60 or -0.17%.

Global Economic Slowdown

Gold was primarily underpinned on Monday after a survey out of the Euro Zone showed business growth stalled this month, dragged down by shrinking activity in powerhouse Germany, where a manufacturing recession deepened unexpectedly.

Early Tuesday, another report showed Japanese manufacturing activity shrank at the fastest pace in seven months in September, underscoring the broadening economic impact of the U.S-China trade dispute and likely escalating the need for policymakers to step up stimulus.

The key report painted a bleak picture of the manufacturing sector, which likely increasing the need for the Bank of Japan to add to its massive stimulus.

Middle East Tensions

The Pentagon announced Friday that President Trump has agreed to send a “modest deployment” of American troops to Saudi Arabia in response to strikes last week against two major Saudi Arabian oil facilities.

Meanwhile, Britain, Germany and France are now backing the United States and blaming Iran for the attacks.

U.S.-China Trade Relations

Helping to keep a cap on gold prices is the upcoming high-level talks between the United States and China. U.S. Treasury Secretary Steven Mnuchin told the Fox Business Network that discussions with China were scheduled in two weeks, propping up the dollar and global shares.

Daily Forecast

The news is currently underpinning gold prices with bullish traders waiting for further evidence of a worsening global economy before aggressively buying.

In the U.S. today, traders will get the opportunity to react to the Conference Board’s Consumer Confidence report at 14:00 GMT. It is expected to come in at 134.1, down from 135.1. An extremely weak report could help underpin prices further.

Traders will also get the opportunity to react to reports on U.S. housing and Richmond Manufacturing.

In the absence of major news on Tuesday, gold traders are likely to follow the U.S. Dollar for direction. The direction of Treasury yields and demand for risky assets will also influence gold prices.