Gold is steady at the start of the trading week. In Monday’s North American session, the spot price for one ounce of gold is $1300.74, up 0.11% on the day. On the release front, there are no major U.S. events on the schedule. On Tuesday, the focus will be on inflation, with the US releasing CPI and Core CPI reports.
The Group of Seven appears to be in disarray, after a dismal summit in Quebec on Friday and Saturday. The summit exposed sharp disagreements between U.S. President Trump and the other six members, and shockingly, the leaders failed to produce a joint statement after the summit. Trump openly clashed with the other leaders over his recent tariffs against the European Union and Canada and tweeted that Canadian Prime Minister Trudeau, who hosted the summit, was “dishonest and weak”. Canada and the EU are furious over recent US tariffs, especially because of Trump pushed them through on the basis of ‘national security’. The glaring cracks in G-7 unity could cast a long shadow on trade relations between the U.S and the “G-6”, with business confidence and capital spending at risk if the tariff spat continues. This could unnerve investor confidence and boost gold, a traditional safe-haven asset in times of trouble.
Investors are keeping a close eye on the historic summit between US President Trump and North Korean President Kim Jong-un in Singapore on Tuesday. The meeting will mark the first ever face-to-face meeting between leaders of the U.S and North Korea. It remains unclear if the two leaders will sign any agreements, or will the sides treat the summit as a “getting to know you” opportunity. Given the magnitude of the event, traders should be prepared for movement in gold prices on Tuesday, especially if progress is made regarding the denuclearization of North Korea.
