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According to RIA Novosti: Russian President Vladimir Putin and Kazakh President Tokayev discussed joint energy projects over the phone.Market Comment: The ECBs hawkish shift provides a bullish argument for the euro.ECB: The economy faces continued challenges.ECB: The downward revision to the forecasts for 2025 and 2026 reflects falling exports and continued weakness in investment, partly due to high uncertainty about trade policy and broader policy uncertainty.March 6, the European Central Bank cut interest rates for the sixth time in nine months, indicating that it is sticking to its easing plan despite the economic turmoil caused by the trade war and new plans to increase European military spending. With inflation approaching its 2% target, the ECB cut its deposit rate by 25 basis points to 2.5%, a level considered "substantially accommodative". The ECB said monetary policy is becoming less restrictive as rate cuts reduce new borrowing costs for businesses and households and loan growth is accelerating. Tonights rate cut may be the last easy decision for ECB policymakers, and any move after next month will spark more heated debate as inflation concerns linger. Germanys move to increase military and infrastructure spending this week could trigger new inflationary pressures; on the other hand, the eurozone economy could be hit if the United States implements its plan to impose "reciprocal tariffs" on all countries that impose tariffs on US imports. ECB President Lagarde may be asked about these risks at a press conference later.

Gold Price Prediction: XAU/USD will settle below $1,750 as attention switches to Jackson Hole

Alina Haynes

Aug 22, 2022 14:47

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After reaching a monthly high of $1,807.96, the gold price (XAU/USD) has dropped for five consecutive trading sessions. The price of gold fell below $1,750.00 for the first time since August. As investors drastically reduce their long positions in gold assets in anticipation of hawkish direction from the Federal Reserve, the price is expected to settle below the aforementioned crucial mark (Fed).

 

Observing contradictory comments in the Fed's minutes on policy direction weakened the gold rise earlier. James Bullard, president of the Federal Reserve Bank of St. Louis, proposed an additional 75 basis point (bps) rate hike to achieve price stability sooner. While a few Fed members have issued a statement on lowering the rate of interest rate hikes to protect the economy from future inflation threats, the majority of Fed policymakers have not.

 

As Chinese President Xi Jinping and Russian President Vladimir Putin have confirmed their attendance at the G20 summit in November, geopolitical concerns are also exerting a significant downward pressure on gold prices. This may renew Moscow's assault on humanity in Ukraine.

 

On the front of economic data, investors await the release of the US Durable Goods Orders report, which is anticipated to decrease to 0.6% from the previous release's 2%. When the US economy has previously shown a flat US core Consumer Price Index (CPI), a fall in economic data is not beneficial for the US dollar index (DXY).

 

On an hourly scale, gold prices have fallen to $1,744.70, which is close to the 50% Fibonacci retracement (set from July 21's low of $1,680.91 to August 10's high of $1,807.93). The 20-period and 50-period Exponential Moving Averages (EMAs) at $1,751.90 and $1,757.50, respectively, are falling swiftly, adding to downward filtering. In the meantime, the Relative Strength Index (RSI) (14) oscillates in a negative band of 20.00-40.00, indicating that further declines are likely.


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