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On April 4, the Yangtze River Delta Railway ushered in the peak of passenger flow during the Qingming Festival. It is expected to send 4.1 million passengers today, 365,000 more than the same period last year, an increase of about 9.8%, and is expected to set a new record for single-day passenger volume. This years Qingming Festival railway transportation will start from April 3 to 7. The Yangtze River Delta Railway is expected to send 17.6 million passengers in 5 days, with an average daily passenger flow of 3.52 million, a year-on-year increase of 6.8%.The yield on the two-year U.S. Treasury note fell to a six-month low of 3.6550% and was last at 3.6611%.On April 4, local time on April 3, U.S. Secretary of Health and Human Services Robert Kennedy Jr. said that about 20% of the layoffs in the Department of Government Efficiency were wrong and needed to be corrected. The U.S. Department of Health and Human Services laid off about 10,000 people on the 1st. Kennedy said that people who should not have been laid off were laid off, and the department is restoring their positions. Kennedy said that canceling the entire lead poisoning prevention and monitoring department of the Centers for Disease Control and Prevention was one of the mistakes. At present, it is unclear what other projects Kennedy may plan to restore.Bank of Japan Governor Kazuo Ueda: Will consider the impact of food costs on consumers.On April 4, local time on the 3rd, the automobile company Stellantis said that due to the impact of the US import automobile tariff policy, the company decided to lay off 900 employees in its five US factories and suspend production operations at two assembly plants in Canada and Mexico. Antonio Filosa, Chief Operating Officer of Stellantis Americas, said that the US factories that were laid off were powertrain and stamping parts factories, which produced spare parts for two assembly plants in Canada and Mexico. According to the plan, the assembly plant in Canada will stop production for two weeks, and the assembly plant in Toluca, Mexico will suspend production throughout April. Filosa said the company is "continuing to evaluate the medium- and long-term impact of tariffs on operations."

Gold Price Prediction XAUUSD - Lower as Investors Seek Additional Clarity from the Federal Reserve

Alina Haynes

Nov 21, 2022 11:44

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After reaching its highest level in three months on Wednesday, gold futures declined on Friday and for the week. As hawkish Federal Reserve officials predicted additional interest rate hikes, investors began booking profits.

 

On Friday, Comex gold futures for February settled at $1769.00, a decrease of $8.80 or 0.50%. The United States Oil Fund ETF (USO) closed at $69.04, down 1.10 points, or 1.57 percent.

 

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Fed Members Generate Uncertainty, Which Encourages Profit-Taking 

In response to a U.S. Non-Farm Payrolls data that indicated an unexpected uptick in the unemployment rate, gold futures have risen by over $100 this month since bottoming in the first week of November. The Fed's streak of 75 basis point rate hikes could come to an end if it decides to raise rates by 50 basis points in December, as a result of the unexpectedly low inflation report.

 

As hawkish comments from many Fed officials intensified last Wednesday, profit-takers began to enter the market. The central message from policymakers was that interest rates will rise.

 

In addition to reducing the rate of rate hikes from 75 basis points to 50 basis points, the Fed may also extend the duration of rate increases. This suggests that the terminal rate, or the rate at which the Fed finishes raising interest rates, could be significantly higher than anticipated.

 

The uncertainty regarding when the Fed will stop rising interest rates and how high they will be when they do is what encourages long speculations and drives prices lower. We are not observing the beginning of a trend reversal, but rather a "When in doubt, get out" mentality.

Bullard of the Fed Set the Bearish Tone 

Wednesday, as gold approached a three-month high, St. Louis Fed President James Bullard halted the rally with strong hawkish remarks.

 

Bullard stated that the Fed's target policy rate must increase to a range between 5.00% and 5.25% from its current level just below 4.00% in order to be "sufficiently restrictive" in containing inflation, though he would defer to Fed Chair Jerome Powell on how much higher to move rates in upcoming policy meetings.

Short-Term Prognosis

After reaching a high of $1791.80 last week, gold prices are currently dropping, with traders likely seeking a break into a value zone before re-entering the long side. Our goal zone is $1705.00 to $1684.60.

 

The market is expected to continue to be influenced by data, thus gold bulls will seek data that proves inflation is decreasing and the economy is faltering. This scenario will provide the Fed with more room to reduce its rate of tightening.

 

As Fed members stated, a single piece of data will not be sufficient to alter their hawkish tone. They want to see additional evidence that inflation is declining.