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Deepgram, a voice AI technology startup, said Tuesday it has raised $130 million at a $1.3 billion valuation and plans to expand into international markets, launch new models, and make acquisitions.January 13th - According to foreign media reports, as core inflation unexpectedly declined slightly in December, investors rushed to buy US government bonds, causing a sharp drop in US Treasury yields and a sell-off of the US dollar. The US core inflation rate in December was 2.6% year-on-year, failing to accelerate to the predicted 2.7%. While these inflation indicators are unlikely to change expectations that the Federal Reserve will keep interest rates unchanged later this month, they may alleviate concerns that accelerating inflation could delay a new round of rate cuts.January 13th - According to CNBC analysis, the U.S. core consumer price index (CPI) rose less than expected in December, further strengthening market confidence that inflation is cooling as the Federal Reserve considers its next interest rate policy move. Data released Tuesday by the Bureau of Labor Statistics showed that the seasonally adjusted core CPI rose 0.2% month-on-month and 2.6% year-on-year, both 0.1 percentage points lower than market expectations. Overall, both the monthly and year-on-year CPI rates were in line with market expectations. This report indicates to some extent that the pace of price increases is slowing towards the Feds 2% target, but the level remains relatively high. Among the sub-items, housing costs, a key factor with strong inflation stickiness, rose 0.4% month-on-month, becoming the largest single contributor to the CPI increase that month. This category accounts for more than one-third of the CPI and rose 3.2% year-on-year.January 13th - According to Reuters, traders increased their bets on Tuesday that the Federal Reserve might not wait until Fed Chairman Jerome Powells term ends in May to cut interest rates, after the U.S. Bureau of Labor Statistics reported that basic consumer price increases were slightly lower than expected. While traders still believe a June rate cut is the most likely outcome, the latest data projects a 42% probability of a Fed rate cut in April, up from 38% before the data release.January 13th - Market analyst Ira Jersey stated that the reassurance brought by the lack of a substantial surge in US inflation has led to blind optimism in the market and pushed up bond yields. The overall CPI increase of 2.7% year-on-year implies that the core PCE annual rate will be below 2.5%, paving the way for the Federal Reserve to adopt a more dovish stance. While a January rate cut is not considered a certainty, it undoubtedly brings the possibility of a March rate cut under consideration.

Price of Gold Fundamental Daily Forecast - Steady after Fed Minutes Show No Unexpected Developments

Daniel Rogers

May 27, 2022 09:15

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Gold futures are marginally higher early on Thursday compared to the previous session's closing price. Prices were under pressure before to the release of the Federal Reserve's most recent meeting minutes, but steadied by market close following the Fed's announcement.

 

The price movement indicates that gold dealers anticipated the Fed's decision and are now prepared to study economic data that may convince officials to rethink their first response to rising inflation. One answer may be optimistic while the other may be negative. However, it might be months before we determine whether the Fed's attempts to tighten monetary policy are effective, which could result in a trading range for gold prices.

Fed Minutes Suggest Central Bank Will Not Become More Aggressive

After the minutes of the Federal Reserve's monetary policy meeting on May 3-4 indicated that the central bank would raise interest rates by 50 basis points in June and July to combat inflation, which they agreed had become a major threat to the economy's performance, gold futures recouped a portion of their dollar-driven losses late Wednesday.

 

The announcement may have been favorable for gold since traders no longer needed to fear a 75-basis-point rate rise that they had feared for the past two weeks. In addition, it appeared from the minutes that the Fed would wait until its September meeting before making any big revisions.

 

Members of the Federal Open Market Committee (FOMC) concur that the U.S. economy is robust enough to absorb two 50-basis point increases in interest rates.

Daily Forecast

Gold traders may now focus on the movement of U.S. Treasury rates and the U.S. Dollar, as the minutes have been completed. The two markets that ultimately decide gold price direction.

 

Inflation, economic growth, and employment statistics will act as yield-moving triggers during the next two months. To review the Fed's objectives. Policymakers seek to boost interest rates sufficiently to reduce inflation while preserving economic growth and a robust job market.

 

From now until September, when the Fed evaluates the impact of the June and July rate rises, U.S. economic reports are expected to influence gold prices.

 

As early as Thursday, when the U.S. Preliminary GDP and Weekly Unemployment Claims data are out, gold dealers will be able to observe this in action.

 

The GDP numbers from the first quarter are outdated, however the initial claims data are current. The market anticipates a reading of 217K. Anything greater will be cause for alarm, but will not derail Fed goals. However, it may prompt some of the weaker gold bears to reduce their short holdings.

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