Gold
Gold prices tumbled after the German ZEW survey showed a surprise dose of optimism is brewing for the eurozone’s largest economy. The expectations survey came in at 25.2, much higher than the consensus estimate of -42 and a strong improvement from the prior -49.5 reading. If Germany is turning corner sooner than many are expected, that will provide a major speed bump in gold’s run to record territory. The path is still likely to be higher for gold, but continued optimism that the rest of Europe is turning the corner could derail a quick return to back above the $1700 level.
The surprise upbeat German outlook has financial markets starting to see light at the end of the long tunnel, but a long recovery is still the base case for Germany, with GDP remaining negative until the third quarter. The survey also noted that they don’t’ expect a return to pre-coronavirus levels before 2022.
If downside pressure persists, gold will find major support from the $1630 to $1650 region.
Gold prices tumbled after the German ZEW survey showed a surprise dose of optimism is brewing for the eurozone’s largest economy. The expectations survey came in at 25.2, much higher than the consensus estimate of -42 and a strong improvement from the prior -49.5 reading. If Germany is turning corner sooner than many are expected, that will provide a major speed bump in gold’s run to record territory. The path is still likely to be higher for gold, but continued optimism that the rest of Europe is turning the corner could derail a quick return to back above the $1700 level.
The surprise upbeat German outlook has financial markets starting to see light at the end of the long tunnel, but a long recovery is still the base case for Germany, with GDP remaining negative until the third quarter. The survey also noted that they don’t’ expect a return to pre-coronavirus levels before 2022.
If downside pressure persists, gold will find major support from the $1630 to $1650 region.