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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."

XAU/USD remains below $2,000 as the market awaits the Federal Reserve's policy decision

Alina Haynes

Mar 21, 2023 14:02

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On Monday of this week, gold prices reached a new yearly high, with XAU/USD surpassing $2,000 for only the third time in recorded history; the last time was during the COVID era.

 

Gold prices have not retreated since the March low of around $1,800, when a strong bull run began. Gold prices have a strong inverse correlation with yields on US Treasury (UST) bonds, which declined significantly in March.

 

The global banking turmoil has compelled investors to reevaluate their outlook on the rising cost of financing. As a result of this uncertainty, investors sought refuge in US Treasury bonds, causing yields to decline.

 

Some speculations imply that the pinnacle in US Treasury yields may have been reached. Gold's function as a safe sanctuary in times of adversity and the decline in U.S. Treasury yields could be behind this exponential price increase.

 

Despite gold prices lingering around $2,000, it is premature to declare a peak. According to the CME FedWatch tool, the markets are pricing in a 26.2% chance that the Fed will leave interest rates unchanged at the conclusion of its March 21-22 meeting, and a 75% chance of a 25 basis point (bps) increase.

 

It is extremely unlikely that the Fed will abruptly end the present rate-hiking cycle. However, it should not be forgotten that the Fed has previously made mid-cycle adjustments. Given that most central banks are nearing the zenith of their rate hike cycles, it is not inconceivable that the Federal Reserve could signal the end of the cycle.

 

Inflation, however, remains above the Fed's objective of 2%, so it would be imprudent for the Fed to halt or end the raising cycle.