Gold price supported by renewed Yuan devaluation

PBoC increased the fixing of the USD-CNY yeasterday is lending renewed support to gold this morning. The price records a three-week high of $1,120 per troy ounce. 

Lower rate hike expectations are also giving gold a boost - the probability of the Fed raising interest rates in September having dropped to only around a third, according to the Fed Fund Future. In euro terms, gold is trading at above the €1,000 per troy ounce mark. Commerzbank assumes that the actions of the Chinese central bank could lead to a devaluation race between currencies, especially in the Asian region, which should benefit gold.