Gold and silver prices rallied this week following weakness in the US dollar and rising inflation concerns. US 10-year inflation expectations climbed and the breakeven inflation rate reached a new 8-year high of 2.492% which is supportive for gold prices.
However global economic data was bearish for gold prices. US weekly initial unemployment claims fell indicating a stronger labor market. Also, Eurozone March retail sales rose more than expectations. German March factory orders were also higher than anticipated.
BOE Governor Bailey said uncertainty about the pandemic remains a risk to the UK and that the BOE has no new thoughts on unwinding QE. Dovish comments are supportive of gold prices.
However gold prices received a setback when Dallas Fed President Kaplan said the risk to the US GDP forecast is likely to the upside, and he wants to see asset tapering talks start sooner rather than later.
Gold prices are likely to remain firm due to the worsening Coivd-19 pandemic situation which supports dovish central bank policy measures. Gold may trade firm while above key support level of 10 days EMA of $1,791 and 20 days EMA of $1,772. It may find stiff resistance near $1,828-$1,841.