Gold’s soft startGold prices (GLD) started 2019 on a relatively soft note. After a dismal fourth quarter, the stock markets have recovered remarkably in 2019. Two major causes were responsible for this turnaround:\n\n- the Fed’s U-turn on its rate hike stance\n- optimism for US-China trade talksGold prices remained weak, meanwhile, as investors flocked to risk assets and shunned safe-haven assets. Sentiment, however, again seems to be turning around.Gold’s safe-haven bids are risingAs we highlighted in Could Gold Prices Rise as Market Concerns Increase?, weaker-than-expected economic data from the Eurozone (HEDJ)(EZU) increased global slowdown concerns. The Treasury yield curve turned negative on March 22, with the ten-year yield (TLT)(AGG) falling below the three-month yield for the first time since 2007. While slowdown concerns weighed on the yields on the long end of the Treasury yield curve, the more dovish-than-expected Fed outlook raised the probability of a rate cut, putting downward pressure on the short-term yield curve.\n\nThese concerns improved the safe-haven bids for gold as well. Gold prices (NUGT) have gained 2.8% in March-to-date and 3.0% year-to-date.\n\nStill, gold has underperformed the broader equity markets with the S&P 500 Index (SPY), the Dow Jones Industrial Average (DIA), and the NASDAQ Composite Index (QQQ) rising 11.7%, 9.4%, and 15.5%, respectively.Gold drivers going forwardThe major drivers for gold going forward in 2019 should be the Fed’s tone and market sentiment regarding global slowdown concerns. If the slowdown concerns persist and the yield curve remains inverted for a long time, gold’s demand should increase, increasing its price. The Fed’s dovish tone and no rate hike stance has, anyway, provided a positive macro backdrop for precious metals, including gold.