Gold prices rebounded this Tuesday morning after the US and China decided to resume their trade negotiation.
At the G-20 summit, US President Donald Trump said that there will be no additional tariffs as discussion with China’s President Xi Jinping is heading in the right direction. He also decided to ease restrictions on Huawei.
On the other hand, both the Bank of America and Morgan Stanley believe that stock market correction is very much on the table later this year despite the positive development between the two economic giants.
Following Trump’s announcement on Saturday, gold traded lower. However, it started to recover slightly during today’s early morning trades.
At 04:12 GMT, Gold futures for August delivery on the Comex division of the New York Mercantile Exchange rose by 0.2% to $1,391.95 per ounce.
Bitcoin Continues to Plunge
Bitcoin dropped by another 10% today in Asia and it fell below the $10,000 level.
Most major cryptocurrencies, especially Bitcoin saw a sudden surge as from June 11. The coin gained more than $6,000 during a two-week rally that was partly due to the launch of Facebook’s Libra.
However, after it almost reached the $14,000 level on Thursday, it started to plunge.
According to financial experts, Bitcoin is now in a bear market as it declined by more than 20% from its recent high.
Today, Bitcoin lost by another 12.1% to $9,942.6. Other cryptocurrencies such as Ethereum, XRP and Litecoin followed the same downward trend.
RBA cuts rate to a record low of 1%
As predicted by several analysts, the Reserve Bank of Australia (RBA) cut interest rates to a record low of 1% in order to revive the Australian economy.
The 25 basis point cut was expected by economists as RBA Governor Philip Lowe warned for further cuts in his speech last June.
According to the Central Bank’s Governor, this recent cut will not boost the economy instantly. Hence, further reduction in the cash rate can be expected.
As a result, Mr Lowe believes that the cash rate cut will help reduce the unemployment rate.
Financial Events to watch for today
- 04:30 GMT – Reserve Bank of Australia (RBA) Interest Rate Decision (Jul)
- 08:30 GMT – Construction PMI (Jun) [UK]
- 14:05 GMT – Bank of England (BoE) Governor Carney Speech [UK]