Trump has won an upset victory and is now president-elect of the United States. This result led to back and forth volatility in gold and the U.S Dollar, ending with gold at around $1,269 per ounce and the Dollar at 3-month highs. The market seems to expect higher inflation and interest rates in the U.S, but there is little indication on what move the U.S Federal Reserve plans to take next.
In Europe, the struggling banks have been boosted by the expectation that Trump’s anti-regulation stance may lead to easier international operations and less punitive fines. UBS Group (UBS) and Credit Suisse Group AG (CS) earn over 35 percent of revenue from North America; these stocks rallied massively in response to the Trump victory.
Bond-yields followed the banks, rallying significantly on the news. Overall, Trump’s low-regulation, fiscal stimulus policy is resonating positively in markets around the world.
Top development: Indian Physical Gold Market Soars.
The Indian physical gold market is still volatile; however, this time the news is positive.
According to sources within India, there are now large lines forming outside gold and jewelry shops, and the metal is selling for prices significantly higher than the spot price outside the country. According to Reuters, physical gold is now trading at significant premiums to the international price.
The Indian physical gold rally is a result of the government's decision to ban large-denomination paper money in its fight against gold smuggling. This move limits the availability of gold in India and increases its price by allowing authorized gold dealers to charge a premium over the international price of the metal.
