Gold: Rebound supported by lower energy – ING

ING strategist Ewa Manthey highlights that Gold has extended its recovery, posting its first monthly gain since February. The metal is supported by easing Middle East geopolitical tensions and sharply lower Oil prices, which reduce inflation concerns. However, ongoing uncertainty over US monetary policy and expectations of rates staying higher for longer are seen as limiting significant upside for bullion.

Bullion balances geopolitics and Fed risks

"Gold edged higher, extending its recovery after posting its first monthly gain since February in July."

"Prices found support from easing geopolitical concerns in the Middle East. Reports of diplomatic efforts aimed at improving shipping conditions through the Strait of Hormuz helped to drive a sharp decline in oil prices."

"Lower energy prices have eased some inflation concerns, offering a more supportive backdrop for bullion."

"Meanwhile, markets continue to assess the outlook for US monetary policy following last week's Federal Reserve meeting."

"Gold is likely to remain caught between improving geopolitical sentiment and ongoing uncertainty over US interest rates."

"Any further decline in energy prices could help improve the macro backdrop for bullion, though expectations for rates to stay higher for longer may continue to limit upside."