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Market news: U.S. Trade Representative Greer and Canadian negotiators will meet in Washington at 12:15 p.m. Eastern Time today (00:15 a.m. Beijing Time the following day).The U.S. Treasury Department has proposed common-sense and low-cost investment rules for the "Trump Account".On August 20th, Federal Reserve Chairman Daly stated that rising long-term yields are a global issue that has weakened their indicative role in Fed policy signals, and he believes the Feds credibility is not at risk. Short-term yields show the market understands the Feds response mechanism, and the Feds policy is in good shape; he sees no evidence of a need for an early rate hike. He expects the inflationary shock to gradually subside, therefore he is "very supportive" of the Fed keeping rates unchanged in July. However, he cautioned against the cumulative effect of multiple inflationary shocks, although he is looking for more worrying signs of inflation, but has not yet seen any. Recent employment and inflation data have not changed the outlook, and he does not currently believe the labor market will drive inflation. Rising bond yields have not sent a policy signal, and it is too early to discuss the pattern of US Treasury issuance. The Fed will find a way to achieve its policy objectives. The Fed will continue to fulfill its responsibilities, regardless of what actions the Treasury takes.Federal Reserves Daly: The labor market is stable; my focus is on inflation.Federal Reserves Daly: Two weaker data points did not make the inflation situation clearer.

Gold Price Forecast: The XAU/USD pair struggles to continue its climb above $1,870, although the upside remains likely

Alina Haynes

Jan 09, 2023 12:00

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During the Asian session, the gold price (XAU/USD) is hovering in a narrow range around the immediate barrier of $1,870. The precious metal hopes to extend its uptrend in light of market players' increased risk appetite.

 

S&P500 futures have contributed to their gains during Friday's surge, indicating an optimistic market sentiment. The US Dollar Index (DXY) has detected resistance at 103.50 and is likely to find support near 103.00. The yields on 10-year US Treasuries have decreased to approximately 3.56 percent due to a loss in safe-haven attraction.

 

Amidst mounting prospects of a U.S. recession, the gold price is garnering considerable attention. Following a string of declines in the US ISM Manufacturing PMI, the Services PMI has also declined, indicating a decline in overall demand in the United States economy. The Services PMI dropped sharply to 49.6 compared to the predicted 55.0. In addition, the New Orders Index, a measure of future demand, plummeted to 45.2% as opposed to the anticipated 58.5%. The U.S. dollar is affected by a slowdown in economic activity and its expectations for the future.


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