Gold: The yellow metal warms investors – TDS

The BOE was the latest central bank to provide an emergency 50bp interest rate cut, while Italy will spend some 25bn euros to combat the virus. As analysts at TD Securities note, investors are comfortable with gold positions.

Key quotes

“We note gold positioning is becoming stickier at higher and higher levels, while any dips are becoming shallower as investors keep running to gold's warm embrace.” 

“The continued downward pressure on interest rates and the USD, and the asymmetric nature of central bank reaction functions, continue to offer fundamental backing for the yellow metal.”

“CTAs have been well-positioned for the precious metal rallies, and we do not anticipate any major systematic flow on the day.”