We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The spread of #coronavirus promises a global economic hit at a time when the global economy is perhaps especially ill-equipped to deal with one. Growth-correlated assets are vulnerable. Get your market update from @DavidCottleFX here: https://t.co/0If0Jw7c2P https://t.co/mph6z70XeF
  • The $JPY continues to struggle against the US Dollar but there seems little appetite to push USD/JPY much beyond a range which has tended to reassert itself since late last year. Get your market update from @DavidCottleFX here: https://t.co/iaVfPSuXy4 https://t.co/1QPhJmYlQv
  • The #Euro may bounce after hitting the lowest level in close to three years against the US Dollar. While the broader trend points firmly lower, selling pressure may be ebbing. Get your market update from @IlyaSpivak here: https://t.co/697SQ9j5FY https://t.co/6SEvwQyod8
  • GBP/CAD has broken below the September uptrend while EUR/CAD may be ending its consecutive 12 day decline with EUR/CHF approaching key resistance as NZD/CAD aims at November lows. Get your currencies update from @ZabelinDimitri here: https://t.co/GpRB7IKhTA https://t.co/hlHlGdhkHc
  • The $GBP recoiled from chart resistance against the US Dollar, setting the stage for prices to resume a bearish trend reversal triggered mid-January. Get your market update from @IlyaSpivak here:https://t.co/lVpyZkIfJt https://t.co/9oXusxs0Kg
  • The #Euro may have more room to fall versus its major peers such as the US Dollar, Japanese Yen and British Pound. What is the technical picture of EUR/USD, EUR/JPY and EUR/GBP? Get your market update from @ddubrovskyFX here: https://t.co/M6fLA9g3BK https://t.co/HMwQgr1WP5
  • The $USD’s aggressive rise versus ASEAN currencies such as the Singapore Dollar, Indonesian Rupiah, Malaysian Ringgit and Philippine Peso prolonged. What is the technical road ahead? Find out from @ddubrovskyFX here:https://t.co/RsFptNzODf https://t.co/u8meQUSsVG
  • $AUD broke critical range support against its US counterpart, suggesting deeper losses are ahead even after prices hit an 11-year low. Get your market update from @IlyaSpivak here:https://t.co/45YpJRjDYj https://t.co/zWAzaL78Sc
  • After negotiating a series of economic and geopolitical risks in 2019, the S&P 500 rounded out the year more than 30% higher. Will the stock market crash in 2020? Find out from @PeterHanksFX here: https://t.co/8KsjB9YkBB https://t.co/4ph9bdMxz9
  • Italy reports first death from coronavirus - BBG
Trump Policies Invite Inflation But Gold Prices May Fall Anyway

Trump Policies Invite Inflation But Gold Prices May Fall Anyway

2019-10-23 02:00:00
Ilya Spivak, Sr. Currency Strategist


  • Trump administration’s economic policy platform invites inflation
  • Global business cycle downturn putting the brakes on price growth
  • Gold prices may fall as inflation hedge appeal fizzles, Dollar gains

Where will markets end 2019? See our Q4 forecasts for currencies, commodities and stock indexes!

Whatever one thinks of the merits of the Trump administration’s economic program, it is surely unorthodox relative to its recent predecessors. A single common thread appears to tie together the three main efforts undertaken by the White House: they all appear to beckon inflation.

The signature economic policy achievement for team Trump thus far has been sweeping tax reform passed in late 2017 that amounted to an intake reduction of about $1.45 trillion, according to the CBO. That offered a near-term boost to growth and inflation.

Rearranging international trade is another key goal. The US-China trade war is most notable, but a fitful renegotiation of NAFTA and heightened tensions with the EU bear mention also. The attendant uncertainty and tit-for-tat tariffs have driven up the cost of products and that of doing business in general.

Finally, the President has taken to badgering the Federal Reserve in public, exhorting Chair Jerome Powell and company to slash borrowing costs. This has come alongside praise for would-be US economic strength. Taken at face value, this too invites a pickup in the pace of price growth.


In fact, growth and inflation peaked and turned lower in the first half of 2018. The initial boost from tax cuts seems to have faded: CPI growth is at a two-year low and economic activity is at its most sluggish since early 2016. That may explain the Fed’s dovish turn this year more so than Mr Trump’s goading.

US growth, inflation fall amid global economic downturn

Continued de-globalization – that is, a prolonged or even escalated trade war – may yet nudge up prices further. That seems unlikely to overpower disinflationary forces however, including those born of its own disruptive influence on global supply chains. As for Fed rate cuts, they seem to be struggling to loosen policy.


On balance, all this might translate into lower gold prices.

The metal began a cautious recovery alongside priced-in inflation expectations (measured by the “breakeven” rate on the chart below) in early 2016. That seems sensible: it is a monetary devaluation hedge. Price growth bets have since collapsed alongside floundering economic performance however.

For its part, gold has managed to prolong its advance as markets recalibrated for a turn from tightening to easing Fed monetary policy. That shift has probably run its course by now, with investors’ already ultra-dovish outlook allowing relatively little room to reprice further in the same direction.

In the meantime, the markets appear to be stockpiling cash. That has potential to drive the US Dollar higher as capital flows to the unrivaled liquidity of the world’s top reserve currency, activating the next phase in a two-year uptrend. That bodes ill for anti-fiat assets that gold epitomizes.

Gold prices may turn lower as inflation expectations sink


--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

To contact Ilya, use the comments section below or @IlyaSpivak on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.


News & Analysis at your fingertips.