While the ASX 200 finished marginally higher overnight (+0.6%), nearing five-month highs last week, the markets have been a little cautious this week.

7,200 seems to be a bit of a resistance level at the moment, especially with the lingering concern of more interest rate hikes by the RBA.

Overall, the ASX 200 has performed well, despite US markets trading mostly flat this past week. Ahead of RBA governor Philip Lowe’s speech overnight, the market seems poised for more hawkish news.

Overnight, in his annual dinner speech, RBA governor Lowe warned Australians to brace for higher inflation and lower economic growth, signalling the very real possibility of more interest rate rises.

Lowe also shot down the idea that wages growth would compensate for higher inflation, while stating that trade restrictions and global conflict are reversing the situation of stable prices we’ve had due to globalisation in the past three decades.

Meanwhile, as China reported its first COVID-19 death in six months, commodities prices have been hit, as the market is expecting Chinese authorities to tighten restrictions that would curb demand in a contracting economy.

Overall, the markets are still wary of global uncertainty based on a number of factors, from China to the war in Ukraine to hawkish comments out of the RBA and the Fed. High inflation and rising interest rates still appear to be a reality, in the short term, at least.

The GDX has stacked on over 14% of gains since the start of the month, and investors are watching closely to see if gold will show further signs of strength. While gold ETFs are continuing to experience minor outflows, a quick reversal could spark serious interest – and further market volatility could certainly bring this on.

Reach Markets has written a Gold Industry Report to provide greater insight into the outlook for gold, what factors will drive the price and what types of gold stocks some industry insiders are investing in. The report is designed to help investors better understand the current state of play and potential opportunities and is free for Reach subscribers. Request the report here.

Next week, in conclusion to our two-part gold summit, we will have the leaders in gold exploration and production to discuss the threats and opportunities within the gold market and what to be aware of when investing in the sector.

Click here to join the second and final session of The Insider: Investing in Gold Summit on Wednesday 30th November at 12pm (AEDT).

Past performance is not a reliable indicator of future performance.