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On August 23, according to Iranian sources on August 22, Iranian Defense Ministry spokesman Reza Tarai-nik stated in an interview that Irans overall weapons and defense equipment production has doubled over the past year. Production of some strategic equipment prioritized for wartime deployment has even more than tripled. To maintain military secrecy, some equipment systems have not yet been publicly displayed. He also stated that if the enemy makes another foolish mistake, it will face an even greater defeat.August 23 - Following the 5.8 magnitude earthquake that struck Honshu, Japan, numerous injuries have been reported. As of 4:00 AM local time, nine people were injured in Saitama Prefecture, and as of 5:00 AM local time, three people were injured in Kanagawa Prefecture. Additionally, some people in Tokyo sustained cuts from broken glass. According to the Tokyo Fire Department, approximately 30 earthquake-related calls had been received as of 3:00 AM local time on the 23rd.On August 23, according to the New York Times, U.S. Trade Representative Greer revealed previously undisclosed trade proposals to Canada on Saturday, stating that these measures would grant Canada the most favorable treatment among all its trading partners. Greer stated that the Trump administration had promised to eliminate the 10% softwood lumber tariff imposed last year under Section 232, and also proposed reducing the 25% auto tariff imposed by Trump last year. Furthermore, because Canada could receive further tax reductions if its vehicles contain any U.S. parts, the auto tariff could have been reduced to 7%. The U.S. also proposed reducing metal tariffs, one of Canadas top concerns. The U.S. proposed reducing tariffs on most Canadian steel exports to the U.S. from 50% to 25% under the so-called tariff quota system, and for aluminum, the U.S. would reduce tariffs from 50% to 25%, without quota restrictions. For downstream products using steel and aluminum as raw materials, the U.S. proposed reducing tariffs by 10 to 25 percentage points, with a minimum of 15%. He also stated that the Trump administration had originally planned to suspend the 50% tariffs imposed on Canadian dairy products, wine, hockey sticks, and other goods that would begin early Saturday morning, while also cooperating on other issues such as key minerals and cargo transshipment. Greer refuted Canadian Prime Minister Carneys claim that "the U.S. is asking for too much and giving too little," stating that the U.S. proposal would "continue to provide them with the best market access and further improve those conditions."U.S. Trade Representative Greer: The United States could have postponed the 50% tariffs imposed on Canadian dairy products and wine.U.S. Trade Representative Greer: The U.S. has proposed lowering tariffs on most Canadian steel products to 25% and reducing tariffs on aluminum products from 50% to 25%.

As the United States enters a recession, the price of gold increases by 1.8%, its greatest increase since March

Charlie Brooks

Jul 29, 2022 11:11

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A U.S. recession means a variety of things to different investors.


It was an opportunity for investors to bid up stock prices on the idea that the Federal Reserve may be more lenient with future interest rate hikes. Given the correlation between the economy and energy use, proponents of long-term oil reserves should be less enthusiastic about demand. It was a hint to gold bulls that possibly significant hedging with the yellow metal would now occur.


Consequently, gold experienced its largest one-day increase since March on Wednesday, following the Commerce Department's first of three estimates indicating that the U.S. gross domestic product likely fell 0.9% in the second quarter, following a previously established decrease of 1.6% in the first quarter.


The successive quarterly decreases in GDP strengthened months of speculation that the United States would enter a recession. In addition, it unleashed a bullish impetus in gold, a market that had been restricted for weeks by sluggish price fluctuations of sometimes just a few dollars.


After hitting a session high of $1,755, gold futures for August delivery on the New York Comex ended the day up $31.20, or 1.8%, at $1,750.30 per ounce.


Now that Treasury interest rates have hit their peak, gold is seeing a breakout. The continuation of stagflation should be favorable for gold prices. As long as Wall Street anticipates a slower pace of Federal Reserve tightening, gold should once again draw safe-haven flows.


Ed Moya, an analyst at the online trading platform OANDA, said, "Gold's biggest risk was that the economy remained robust and that the Federal Reserve may need to increase its rate hikes more aggressively."


Moya said that the likelihood of the Fed increasing interest rates by one percentage point has long ago gone. "Gold is breaking out now that Treasury interest rates have peaked. The continuation of stagflation should be favorable for gold prices. As long as Wall Street anticipates a slower pace of Federal Reserve tightening, gold should once again draw safe-haven flows.


Since it hit record highs above $2,100 in August 2020, gold has failed to live up to its reputation as a hedge against inflation for the most of the previous two years. One explanation for this is the Dollar Index's 11 percent climb this year, which follows a 6 percent increase in 2021.


Contrarian to gold, the dollar has lost approximately 1 percent against a basket of six other major currencies over the last two days.


Moya believed, however, that gold might see considerable resistance at $1,800.

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