The Fed's report yesterday, as well as today's speeches by a number of members of the Monetary Policy Committee, have forced traders to focus on bond purchases, thereby lowering interest rates on two- and ten-year US bonds. Clearly correlated, this strong bullish signal for gold. 10-year bond yields declined to below 3% and 2-year securities registered a significant decline. After the recent downturn, gold may also benefit from a fall in real income, as many investors will most likely not be willing to chase purchases of assets from emerging markets.
Source: Bloomberg Pro Terminal
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