Gold plunges on strong US Dollar, Trump’s trade policies

Gold experiences worst week in five months; DXY climbs to 105.57 on Trump trade fears.

Treasury market closure limits safe-haven flows; investors brace for Fed rate outlook in December.

Fed officials’ remarks, key US inflation data and Retail Sales to further impact Gold’s path.

Gold plummets more than 2.50% on Monday as the Greenback hits a four-month high. Expectations that Donald Trump’s second presidential term could spark an escalation on the trade war front is keeping the US Dollar on the front foot. The XAU/USD trades at $2,611 after reaching a daily high of $2,686.

The non-yielding metal printed its worst week in over five months, following the results of the US presidential election. The US Dollar Index (DXY), which tracks the performance of the buck against six peers, climbed 0.60% to 105.57.

The US Treasury market remains closed in observance of Veteran’s Day. In the meantime, US equity markets fluctuated despite reaching record highs.

Overnight news revealed that Blackrock and JPMorgan warned the US bond sell off is “far from over,” according to Bloomberg reports. “Trump’s fiscal plans may rekindle inflation and increase the budget deficit, while traders have pared bets for how deeply the Federal Reserve will cut interest rates,” was read on the report.

For the upcoming December meeting, the Federal Reserve (Fed) is expected to lower rates by 25 basis points, even though odds moved back from 80% a week ago to 65% chances.