Gold prices report on May 7, 2018

Editorial Team Global InterGold Editorial Team

Analysts explain the interrelations of the price of gold and talk about the reasons for the precious metal’s price change in the near future.

Experts suspect that a significant correction of gold prices is coming soon. According to commodities consultant at INTL FCStone Edward Meir, it is important to monitor the development of Iran's nuclear deal in May. International events have the potential to raise the price of gold. On May 12, The President of United States Donald Trump must respond to the extension of the agreement with Iran. The Iranian nuclear agreement implies suspension of sanctions from Tehran in exchange for granting permission to observe nuclear facilities in the country.

On Thursday, 3rd of May, prices of the yellow metal rose. The increase in the value of gold was influenced by the results of the Fed meeting and positive labor market data in America. The Federal Reserve left interest rates unchanged.

Daniel Hynes, senior commodity strategist at Australia & New Zealand Banking Group Ltd:

"Volatility is starting to pick up. These issues will become a much more important driver of gold price, we’ll be focusing on in the short term. Rising global tensions would be quite supportive for safe-haven asset."

On the 3rd of May, in the run-up to the negotiations, the price of gold increased, amounting to $1,315 per ounce.

On Friday, 4th of May, trade issue talks continued between Beijing and Washington. However, according to Bloomberg, the high-level meeting did not bring the expected results. Both sides only agreed to continue further negotiations and recognized the existence of controversial issues that need to be resolved.

Uncertainty adversely affected the price of precious metals. Additionally, the position of gold was influenced by the U.S. labor market data.

On Friday, the price of gold was $1,309 per ounce.

On Monday, 7th of May, prices of the yellow metal have increased.

According to one of the analysts of Bank of America Merrill Lynch (BAML), gold plays a big role in the formation of the market. Prices of the precious metal will increase to a resistance level of $1,350-$1,375 this year, predicts BAML Technical Strategist Paul Ciana.

On Monday, the price of the yellow metal was $1,315 per ounce.

According to the World Gold Council, the global demand of central banks for gold increased by 42% over the past year.

The investment bank Bank of America Merrill Lynch (BAML) published a 2018 forecast for gold. According to the specialists of the bank, a number of factors will push the precious metal for a significant growth in the course of the year. The driving forces of the gold price will be the growth of inflation and the U.S. budget deficit. In a state of uncertainty, investors will be forced to turn to gold as the safest asset.

The financial adviser and the former director of the Office of Management and Budget of the USA David Stockman:

"In the current situation, ordinary people are left with nothing else but to buy investment gold. I believe that its value will show significant increase in the future."