Little Changed In Asia; Minor Reprieve On Recession Worry

Gold sits $2/oz worse off at typing to print $1,809/oz, a little below best levels highs after briefly showing above Friday’s high earlier in the session.

• To recap, gold recovered from five-month lows (at $1,784.6/oz) on Friday to close ~$4/oz firmer, breaking a four-day streak of losses. The recovery in gold on Friday was facilitated by a miss in the U.S. ISM m’fing survey and May construction spending, exacerbating heightened recession worry from some quarters, with the Atlanta Fed’s GDPNow tracker for Q2 ‘20 declining to -2.1% in the wake of the data print (from -1.0% prior).
• Elsewhere, BBG source reports over the weekend have pointed to the EU preparing bloc-wide sanctions on Russian gold imports, with Australia declaring their embargo on Russian gold on Sunday. The moves may ultimately change little, taking reference to previously-flagged reports of earlier western sanctions since Mar ‘22 already having restricted flows within the space.
• From a technical perspective, the move lower on Friday has seen gold briefly break support and the bear trigger at $1,787.0/oz (May 16 low), a clearer break of which could expose key support at $1,780.4 (Jan 28 low).