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Nestlé India shares rose 3% on quarterly profit growth.On July 22, David Zahn, head of European fixed income at Franklin Templeton, stated in a report that the firms base case forecast is for the European Central Bank (ECB) to raise interest rates for the final time in September, with inflation expected to remain above the ECBs 2% target for the next few quarters. Afterward, the ECB is expected to hold rates steady to assess the impact of the already implemented tightening policies. However, Zahn said the ECB remains highly data-driven. "If renewed tensions in the Gulf region push up energy prices and keep inflation above target for an extended period, policymakers may be forced to consider further rate hikes." Franklin Templeton anticipates the ECB will begin easing policy in 2027.The Hang Seng Tech Index fell by more than 3%, with PCB, AI applications, and prominent tech stocks among the biggest losers.The commander of the Kyiv drone force said that Ukrainian drones struck 13 Russian ships in the Black Sea and the Sea of Azov in the past 48 hours.Futures Commentary by Everbright Futures: Overnight, gold, copper, and oil prices rose in tandem, with London spot gold surging above $4,100/ounce in early trading, indicating a recovery in market sentiment. However, the global market is still digesting the uncertainty surrounding US trade policy and geopolitical conflicts. Recently, the US tariff policy entered a transition period, with the US announcing a 50% tariff increase on some Canadian products. Given the combination of macroeconomic fluctuations and geopolitical disturbances, a cautious approach is advised for gold in the short term. On the macro front, the market is in a quiet period ahead of the Federal Reserves interest rate meeting, focusing on the US-Iran conflict. Yesterday, the US president clearly dampened the prospects for US-Iran talks, stating that Iran wants to talk but the US has "no interest," and that it will "soon" strike the Kosan nuclear facility. Furthermore, US Trade Representative Greer hinted that the US will soon introduce new tariff policies to replace the expiring 10% global import tariff. Since the renewed conflict between the US and Iran, gold prices have not remained pessimistic amid fluctuating inflation and interest rate expectations; instead, the price has begun to rise, potentially indicating a gradual shift in market trading logic for gold in the second half of the year. However, whether this trend can continue remains to be seen. In the short term, a defensive approach is still recommended to cope with the highly volatile environment. Investors should continue to monitor the US-Iran conflict, Federal Reserve policy expectations, and whether rising interest rates will trigger liquidity risks in overseas financial markets.

Forecast for the price of gold: XAU/USD hopes to reclaim $1,800 as investors lower their expectations for US inflation

Alina Haynes

Aug 10, 2022 11:29

截屏2022-06-10 下午4.40.17_1024x576.png 

 

After reaching a new monthly high at about $1,800.00 on Tuesday, the price of gold (XAU/USD) is now showing a contraction in volatility. On Tuesday, the precious metal made a respectable rise to the north before moving sideways in anticipation of the US Consumer Price Index (CPI). According to the street estimates, the inflation rate decreased considerably from the previous announcement by 40 basis points (bps) to 8.7%. The price rise index, however, is very likely to make an unexpected shift.

 

The investment community is aware that rising oil prices continued to be the key factor pushing up price pressures. Now, concerns about fixed supply and a bleak demand forecast on the oil front have caused an even greater decline in oil prices. The inflation rate will also show the multiplier effect.

 

Additionally, the positive US Nonfarm Payrolls (NFP) data from last week suggests that the inflation rate may climb more than expected. In contrast to the 372k jobs added in June, the US economy added 528k new employment in July. Well, until the dust settles for a longer period of time, officials at the Federal Reserve (Fed) will still have a difficult task.

 

Following a robust recovery from the lower part of the Rising Channel at roughly $1,765.00, gold prices are currently rising quickly. The upper part of the aforementioned chart pattern is drawn from the high of July 22 at $1,739.37, and the lower part is drawn from the low of July 27 at $1,711.55.

 

The upside filters are strengthened by the scaling higher of the 20- and 50-period Exponential Moving Averages (EMAs) at $1,785.15 and $1,772.00, respectively. Additionally, the Relative Strength Index (RSI) (14) has moved into the bullish zone of 60.00-80.00, indicating further gains are still to come.


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