During the Asian session on Wednesday (November 30), spot gold fluctuated slightly and is currently trading around $1,752 per ounce. The geopolitical situation between Russia and Ukraine is tense, and the latest China’s November manufacturing PMI data and non-manufacturing PMI data show a difference It is higher than expected and the previous value, and it is lower than the 50 boom-bust line, providing safe-haven support for gold prices. However, the U.S. dollar index bottomed out on Tuesday and U.S. bond yields stabilized and rebounded, making gold bulls wary.
Market attention is now focusing on Fed Chairman Powell’s speech on the US economic outlook and job market at 2:30 a.m. Beijing time on Thursday.
In addition, this trading day will also usher in a series of economic data. The European session will release German November employment data and the Eurozone November CPI data. The revised value of GDP in the third quarter and the data of JOLTs job vacancies in the United States in October.
In addition, on this trading day, there will be a speech by Peel, the chief economist of the Bank of England, a speech by Lisa Cook, the governor of the Federal Reserve, on the outlook for the economy and monetary policy, and the Beige Book on the economic situation of the Federal Reserve. Investors also need to pay attention.
NATO promises to provide more aid to Ukraine, and air defense sirens are sounded across Ukraine
The geopolitical situation still provides safe-haven support for gold prices.NATO allies pledged on Tuesday to provide Kyiv with more weapons and equipment to help restore power and heating in Ukraine that had been disrupted by Russian missile and drone strikes. Meanwhile, air defense sirens sounded across Ukraine for the first time this week.
Although air defense sirens were later lifted across Ukraine, Ukrainians fled from the streets to air-raid shelters. In the Donetsk region in the east, Russian troops bombarded Ukrainian targets with artillery, mortars and tank fire.
NATO allied foreign ministers, including U.S. Secretary of State Blinken, began a two-day meeting in Bucharest to seek ways to keep Ukrainians safe and warm while supporting Ukrainian forces through the coming winter campaign.
“We need air defense systems, IRIS, Eagle, Patriot, we also need Transformers. In short. Patriots and Transformers are what Ukraine needs most,” Ukrainian Foreign Minister Kuleba told reporters on the sidelines of the meeting.
Former Russian President Dmitry Medvedev warned NATO not to provide Ukraine with patriots.
NATO Secretary General Jens Stoltenberg said Russian President Vladimir Putin was “trying to use winter as a weapon of war” as Russian troops retreated on the battlefield.
NATO foreign ministers condemned Russia’s “sustained and unconscionable attacks on Ukraine’s civilian and energy infrastructure” in a statement, confirming a 2008 decision that Ukraine would eventually join NATO.But no specific steps or timetable were announced to bring Ukraine closer to joining NATO
U.S. consumer confidence falls to four-month low, but labor market tightens
In terms of economic data, investors need to pay attention to a series of heavy economic data following this week.
U.S. consumer confidence fell to lowest level in four months in NovemberHouseholds are less enthusiastic about making big-ticket purchases over the next six months amid high inflation and rising borrowing costs, raising the risk of a recession next year.
World Business Research data showed on Tuesday that the U.S. consumer confidence index fell to 100.2 in November from 102.2 in October. The drop in confidence was concentrated in the age group 55 and over, and households earning less than $50,000 a year. Low-income households bear the brunt of high inflation, with consumer prices rising at the fastest rate since the early 1980s ahead of October from a year earlier.
However, the survey released by the World Enterprise Research Institute on Tuesday also showed that,Consumers remain optimistic about the labor market,That could limit some of the expected economic downturn. The labor market has shown resilience despite aggressive rate hikes by the Federal Reserve, helping to keep consumer spending and the broader economy steady.
Jeffrey Roach, chief economist at LPL Financial, said, “The trend of weakening confidence points to a recession, which is likely to occur in the coming year. However, given the tight labor market and signs that layoffs may not be as severe as feared, any Any potential recession is likely to be short and shallow.”
Consumers’ 12-month inflation expectations rose to 7.2 percent from 6.9 percent in October, the highest in four months, which the survey attributed to higher gasoline and food prices.
The labor market gap measure in the survey rose to 32.8 from 31.8 in October. The indicator is based on respondents’ perceptions of whether job opportunities are plentiful or difficult to obtain and is linked to the Labor Department’s unemployment rate.
While the indicator was down from 44.7 in November last year, it was still pretty high by historical standards. The gauge rose in November from the previous month despite a surge in layoffs in the technology sector and in rate-sensitive financial and real estate sectors.
Data due on Wednesday will likely show job vacancies remained high in October, according to a Reuters poll. There were 1.9 job vacancies for every unemployed person in September.
Fewer people are willing to buy big-ticket items in the next six months as inflation remains a major concern for consumers, the survey showed. Buying intentions fell across the board, pointing to a slowdown in demand for commodities and also fueling expectations that a recent slowdown in commodity inflation may become entrenched.
The U.S. government is expected to confirm on Wednesday that the economy rebounded strongly in the third quarter after gross domestic product (GDP) contracted in the first half of the year.
The U.S. dollar index rose for three consecutive days
In terms of the U.S. dollar index, during the Asian session on Wednesday, the U.S. dollar index weakened slightly and is currently trading around 106.67; A positive line with a lower shadow line was recorded on the first trading day, implying that the buying below is strong, and the MACD is initially golden cross,The short-term bullish signal of the dollar has strengthened, and it is expected to fluctuate and test the resistance near the 21-day moving average of 107.96. The near-two-week high hit on November 21 and the round-number resistance of 108 are also near this position; Certain downward pressure.
Below, pay attention to the support near the 5-day moving average of 106.43. If the support at this position is lost, it will weaken the short-term bullish signal of the US dollar index.
U.S. bond yields stabilize and rebound
In terms of U.S. bond yields, the U.S. 10-year Treasury yield is currently trading around 3.739% on Wednesday. On Tuesday, the yield closed up 1.24% to 3.748%. The K-line recorded a lower shadow line for three consecutive trading days, implying that the lower The support is strong, and there is a short-term rebound opportunity, which is not good for gold prices.
“We haven’t gotten any new information and new economic data that would significantly change the path (of the market),” said Tom Simons, money market economist at Jefferies & Co.
He said that the market was slow to digest the “extremely consistent” message sent by the Fed, which is that the rate hike has not been completed and will reduce the rate hike, but after reaching the terminal rate, it will stay at that level for a while.
The fed funds futures market is pricing in a 63.5% chance of a 50 basis point rate hike at the Fed’s Dec. 13-14 policy meeting, reaching a terminal rate of 5.007% in June next year before cutting it in December 2023. to 4.644%.
The market believes that “the Fed will be able to move the federal funds rate to a more neutral level sooner than is possible,” Simons said.
Wall Street traders typically want to lock in borrowing costs for the corporate debt they underwrite. In the process, traders sell Treasuries as a hedge to lock in the borrowing costs of the bond issue before the deal closes. Once the bonds are sold, traders buy Treasuries to exit the “rate lock.”
“We’re at the lower end of the yield spectrum,” said Subadra Rajappa, head of U.S. rates strategy at Societe Generale. “When you see corporate bond supply becoming a factor, you tend to see some Treasuries sell off (bond yields go up) .”
On the whole, the short-term trend of gold prices is highly variable, and investors need to pay close attention to the economic data released this trading day and the speeches of Federal Reserve Chairman Powell. Due to the hawkish speeches of many Federal Reserve officials this week, there is a chance for a further rebound in the short-term dollar and U.S. bond yields, and the gold price has also recorded a K-line with a shadow line for three consecutive trading days, suggesting that the upper selling pressure is stronger. Further callback risks, pay attention to the support near the 21-day moving average of 1732.25 and the November 9 high of 1722.24. The strong support is near the 100-day moving average. Before falling below the 100-day moving average of 1712.8, the midline is still biased towards bulls. A break above resistance near Monday’s high of 1763.63 would add a short-term bullish signal.
At 10:26 Beijing time, spot gold was at $1,752.60 an ounce.