Home » The Fed is trying to stand firm at the threshold, focusing on when the Fed will tighten monetary policy provider FX678

The Fed is trying to stand firm at the threshold, focusing on when the Fed will tighten monetary policy provider FX678

by admin
The Fed tries to stand firm at the threshold, focusing on when the Fed will tighten its monetary policy

In the European market on Monday (July 26), the international spot gold price rose above US$1,800. Supported by the weakening of U.S. Treasury yields and concerns about the increase in the number of delta mutation infections, investors were concerned about the Federal Open Market Committee (FOMC). ) This week’s meeting.

The analysis believes that although the US dollar index is still relatively strong, global pandemic concerns remain, the uncertainty of the U.S. fiscal agreement has re-emerged, and the additional impact of the international geopolitical situation has also begun to ferment, which more or less supports the demand for safe-haven gold purchases. .

Stephen Innes, managing partner of SPI Asset Management, said that there is no guarantee that the scourge of the new crown has been rid of, which is continuing to maintain safe-haven gold buying, simply because this may allow the central bank to maintain a dovish attitude. Unless the situation in the new crown deteriorates significantly, investors are unlikely to buy back gold on a large scale.

The number of new crown cases continued to increase over the weekend, and some countries in Asia and Europe are working hard to control the spread of the highly infectious delta variant virus. Australia’s largest city, Sydney, is expected to announce further blockade measures on Monday, which may continue for another six weeks until mid-September, which will cause a further negative impact on the country’s economy than expected.

See also  West Bank, escalation of tension in Gaza: Palestinian rockets in the night, Israel bombs a site for the manufacture of weapons

Helge Braun, the chief of staff of the German government, said that he does not plan to introduce new lockdown measures across the country in the face of the current epidemic, but may consider introducing measures to prohibit unvaccinated people from entering high-risk places such as restaurants, theaters and stadiums in order to treat them. Responsible for your own health. Earlier, French President Macron has announced the implementation of the “vaccine passport” policy, which has triggered a huge controversy among the citizens.

The decline in the yield on the 10-year U.S. Treasury bond has reduced the opportunity cost of holding gold. At the same time, Asian stock markets fell to their lowest point this year, as concerns about tightening regulations hit China’s stock markets, prompting investors to turn to safe-haven assets such as gold.

The Fed’s meeting on Tuesday and Wednesday is the focus of investors’ attention. Although no policy changes are expected, investors will look for clues to understand when the Fed may begin to tighten its loose monetary policy.

Goldman Sachs predicts that, given that the Fed will not release the quarterly economic report and future policy expectations at the Fed’s meeting this week, there will not be much content in the resolution that will interest investors. The Fed is expected to maintain the policy tone released at the last meeting, emphasizing that future actions to reduce easing are “steadily advancing,” but it will not give a specific roadmap arrangement.

The bank believes that the Fed will not give further hints on the issue of easing easing at the next meeting in September, and then further strengthen the hints in November, and finally will officially start actions in December. In this situation, investors will be more focused on the Jackson Hole Global Central Bank Annual Meeting next month, as well as the next Fed policy meeting on September 21-22. At the moment, investors will mainly listen to the Fed. Chairman Powell’s statement in the press conference will also limit the accompanying market volatility.

See also  Ukraine - Russia, new round of sanctions against Moscow. There is no agreement on Swift. Borrell: "Putin sanctioned like Assad and Lukashenko"

Kunal Shah of Nirmal Bang Commodities, a commodities trader in Mumbai, said that any indication of the Fed’s hint to cut stimulus measures will trigger some market volatility and (may put gold prices) more downward pressure because it will lead to a stronger dollar. The US dollar index is close to the three-and-a-half-month high set last week, inhibiting the attractiveness of gold.

The well-known financial website Economies.com stated that the first target for the price of gold is at US$1,79.00 per ounce. If it falls below this level, it will confirm that the price of gold has fallen further to US$1770.00 per ounce.

The analysis believes that investors will wait and see whether the price of gold can break through the key short-term resistance of $1,812 within a day, which will be a sign of further bottoming and stabilization of the short-term market.

The latest data from the Chicago Mercantile Exchange Group’s gold futures market shows that last Friday (July 23) gold open positions increased for the fourth consecutive day, this time an increase of nearly 6,000 contracts. At the same time, trading volume increased by approximately 84,800 contracts, reversing the previous decline.

At 17:13 Beijing time, the international spot gold price reported US$1,808.80 per ounce, an increase of 0.37%.

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy