Gold goes nowhere with trade war fog starting to develop

LONDON (February 4) Gold’s price (XAU/USD) sees traders mulling on their next steps and moves, after its recent move to new all-time highs and after China retaliated against US tariffs issued over the weekend. Beijing imposed a 15% tariff on less than $5 billion of US energy imports, such as Coal and Liquified Natural Gas (LNG), and a 10% fee on American Oil and agricultural equipment. It will also investigate Google for alleged antitrust violations. Markets are unclear on what to do with these retaliatory tariffs and are showing whipsaw patterns on Tuesday’s price action. 

On the economic data front, the calendar is light ahead of the runup to the Nonfarm Payrolls report, scheduled on Friday. On Tuesday, the JOLTS Job Openings for December could be of interest later in the day, followed by two Federal Reserve (Fed) speakers, Atlanta Fed Raphael Bostic and  San Francisco Fed Mary Daly. 

Daily digest market movers: Quick resolve

• China retaliated to US President Donald Trump’s opening trade war tariffs by targeting a handful of American companies and slapping levies on some US goods, in a move seemingly designed to avoid escalating tensions between the world’s two biggest economies, Bloomberg reports. China's response was seen as "measured and appropriate" and "targeted to send Trump a warning without hurting its own access to important commodities."The tariffs are set to kick in on February 10, potentially leaving room for negotiation.
• European Central Bank (ECB) member Olli Rhen said that EU should retaliate if President Trump imposes tariffs, the Financial Times reports. 
• At 15:00 GMT, the December JOLTS Job Openings report is due. Expectations are that there will be a decrease to 8 million job openings, down from 8.098 million in November. 
• At 16:00 GMT, Atlanta Fed President Raphael W. Bostic moderates a conversation with Atlanta Mayor Andre Dickens at a National Housing Crisis Task Force meeting in Atlanta.
• At 19:00 GMT, Federal Reserve Bank of San Francisco President Mary Daly will participate in the Walter E. Hoadley Annual Economic Forecast panel, hosted by the Commonwealth Club World Affairs of California.
• The CME FedWatch tool shows an 86.5% chance of keeping interest rate unchanged in the March 19 meeting, compared to 13.5% for a 25 basis points rate cut. 

FXStreet