Gold came under renewed pressure, with the US 10-year yield hitting 3.5% and the US dollar appreciating. Economists at ANZ Bank believe the gloomy economic backdrop should strengthen gold’s appeal.

The sell-off in equity markets hasn’t added any safe haven demand

“The risk-off sentiment is not supportive, with gold and equity markets moving in tandem. Nevertheless, further weakness coupled with slowing economic growth should enhance gold’s haven appeal.”

“Investment demand remains weak. The premium for physical gold turned positive in China and India, but demand in China has been weighed down by lacklustre retail jewellery sales. Indian gold imports rebounded in May driven by the traditional wedding season. That said, off-season months could see physical demand weaken.”