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Japans construction orders fell 6.7% year-on-year in May, compared with a previous reading of -32.3%.Japans housing starts rose 33.9% year-on-year in May, below the expected 31.80% and the previous months 11.40%.June 30th - Prices surged due to the Iranian situation, quickly giving back as markets anticipate the resumption of previously disrupted Middle Eastern supplies. Aluminum prices are on track for their biggest monthly drop since 2008, having plummeted over 15% so far in June. The temporary ceasefire agreement between the US and Iran fueled optimism, with markets expecting the reopening of the Strait of Hormuz to resume freight transport in the Middle East. This expectation erased gains from the previous three months. Like other metals, aluminum prices have also been impacted by the rapid strengthening of the US dollar since mid-May, making dollar-denominated metals more expensive for most buyers. Furthermore, market expectations that the Federal Reserve will need to maintain high interest rates for an extended period, and may even raise rates further to curb inflation, have also weighed on the demand outlook.On June 30th, the National Energy Administration released the "China Power Supply Development Report 2026." The report shows that my country has built the worlds largest power supply system, forming a world-class mega-power supply service network covering both urban and rural areas. The report indicates that by 2025, my countrys total electricity consumption will reach a new milestone, exceeding 10 trillion kilowatt-hours, with nearly 800 million electricity users, leading the world in user volume. There are also 99,000 power supply service outlets nationwide, employing over 560,000 people, propelling my countrys power supply capacity and service level into the ranks of the worlds top tier.On June 30, Eli Lilly and Innovent Biologics (01801.HK) jointly announced that they have reached a cooperation agreement regarding the rights to Eli Lillys CDK4&6 inhibitor Vizzar® (abecicalbide tablets) in mainland China: Innovent Biologics will be responsible for the import, sales, promotion and distribution of Vizzar® (abecicalbide tablets) in mainland China; Eli Lilly will continue to be responsible for the production, supply and ongoing development of the product.

The Devil Is In The Details: Gold Analysis - Federal Reserve Minutes

Larissa Barlow

Apr 07, 2022 10:33

Analyses of Federal Reserve Minutes 

While both the FOMC statement and Chairman Powell's press conference provide market participants with information about the FOMC's updated and revised monetary policy, it is the release of the minutes that provides investors with significantly greater clarity and understanding. The devil, as they say, is in the details.

 

The Federal Reserve issued the official minutes from its March FOMC meeting today, providing insight into the central bank's current plans to begin unwinding its balance sheet assets. Beginning in March 2020, the Federal Reserve will add around $4.6 trillion to its balance sheet by purchasing $120 billion monthly in mortgage-backed securities ($40 billion) and US Treasury securities ($80 billion), bringing their total to just over $9 trillion.

 

According to Federal Reserve Governor Lael Brainard, the Fed intends to employ a mix of interest rate rises and a quick run-off of the balance sheet to bring US monetary policy closer to neutral later this year.

 

However, the minutes released today imply that the Federal Reserve will unwind around $3 trillion over the next three years, reducing its $9 trillion balance sheet to $6 trillion. While the Fed appears to be indicating a quick runoff of its balance sheet, the reality is that the Federal Reserve's balance sheet will be nearly $2 trillion larger than it was prior to the epidemic.

 

"Participants continued their discussion on plans to reduce the size of the Federal Reserve's balance sheet in a manner consistent with the methodology outlined in the Committee's Principles for Reducing the Size of the Federal Reserve's Balance Sheet, announced following its January meeting."

 

Additionally, the minutes stated, "While no decision was made regarding the Committee's plan to reduce the Federal Reserve's balance sheet at this meeting, participants agreed that significant progress had been made on the plan and that the Committee was well positioned to begin the process of reducing the balance sheet's size as soon as after the conclusion of its upcoming May meeting."


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