NEXT WEEK'S mid-term US elections could dent the Gold Price, according to a major-bank analyst.
Speaking to the Financial Times, "The congressional election is regarded as among the most important political events globally that is likely to affect the Gold Price," says HSBC's chief commodities analyst, James Steel.
"Given the uncertain US economic outlook, this year's mid-terms have added importance."
Noting that a dip is by no means guaranteed on Tuesday's result – widely expected to see a broad victory by Republican candidates – Steel says that "Gold may benefit from Democratic dominance [of the US Congress] because of a perception that Democrats have a greater proclivity to run budget deficits and redistribute wealth, policies that could eventually promote inflation or hurt financial markets."
Of course, Steel adds, the Gold Price is "also subject" to many other factors besides US domestic politics, as it's steady rise amid the global financial crisis starting in May 2007 shows.
Even so, investors waiting to Buy Gold on a pullback should note that, with pollsters currently pointing to likely Republican gains in both the House and Senate, prices "might be expected to come under pressure".
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