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Market news: Nvidia (NVDA.O) and Deutsche Telekom plan to build a data center worth 1 billion euros in Germany.On October 28th, the Federal Reserves Policy Committee was expected to take two decisively dovish actions on Wednesday: a 25 basis point rate cut and a signal of further easing, while also announcing the end of its balance sheet reduction program (a move that could put downward pressure on Treasury yields). Derek Tang, an analyst at Fed watcher LHMeyer, noted, "The dual actions of a rate cut (coupled with expectations of subsequent easing) and an early halt to the balance sheet reduction program will significantly support market risk appetite." He added that while the decision to end the balance sheet reduction this week remains uncertain, the recent tightening of financing markets has significantly increased the likelihood of such a decision.According to the Financial Times on October 28, under new rules to be announced by the UK Financial Conduct Authority on Tuesday, traders shorting UK-listed companies will no longer need to publicly disclose their identities. The regulator is expected to adopt an anonymous aggregation system, publishing only the total amount of short positions held against each company. This rule change stems from the UKs departure from the EU regulatory framework after Brexit. While the EU previously required public disclosure of short positions exceeding 0.5% of a companys equity, the new UK rules will align with the US regulatory system, which only requires the disclosure of the total amount of short positions without disclosing the specific holders. The FCA also plans to relax the threshold for short sellers to report their positions to the regulator, raising it from 0.1% of equity to 0.2%. This change is seen as a response to the governments call to enhance the UKs economic competitiveness and is expected to be welcomed by the hedge fund community. However, the reduced regulatory transparency has also raised market concerns.On October 28, AMD (AMD.O) announced a supercomputer agreement with the U.S. Department of Energy. AMD will provide computing power for the Lux artificial intelligence supercomputer system at Oak Ridge National Laboratory. AMD stated that when the Lux and Discovery systems are fully deployed, they will represent a combined $1 billion in private and public funding. The Lux AI supercomputer is expected to be operational in early 2026.Market news: AMD (AMD.O) reached a supercomputer agreement with the US Department of Energy.

Gold Price Prediction: XAU/USD struggles above $2,000 as additional Fed rate increases appear inevitable

Daniel Rogers

Apr 17, 2023 13:44

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During the Asian session, the gold price (XAU / USD) appears vulnerable above the psychological resistance of $2,000.00. Following a four-day low of $1,992.50, the precious metal has exhibited a recovery trend. However, the recovery appears precarious as bullish wagers on the US Dollar Index (DXY) limit the upside.

 

As the probability of a consecutive 25 basis point (bp) rate hike from the Federal Reserve (Fed) is exceedingly high, the USD Index seeks to extend its recovery above the immediate resistance of 101.75. According to the CME Fedwatch instrument, the likelihood of a rate rise is nearly 80%.

 

In the meantime, S&P500 futures posted significant gains early on Monday, following a moderate decline on Friday. Quarterly earnings season is anticipated to keep US equities stock-specific. As a result of the precipitous drop in petroleum prices in March, manufacturing and oil-dependent businesses could experience a reasonable earnings rebound.

 

The demand for U.S. government bonds has decreased considerably in response to rising wagers on additional Fed policy restrictions. President of the Federal Reserve Bank of Atlanta Raphael Bostic stated that with one more quarter-point increase in interest rates, the Fed can conclude its tightening cycle with some assurance that inflation will gradually revert to its 2% objective.