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Conflict Update: 1. Saudi Arabia claims Houthi attacks injured two people. 2. Houthis claim Saudi Arabia launched 129 airstrikes on Yemen in 48 hours. 3. Houthi rebels claim to have used numerous ballistic missiles and drones to attack Saudi military facilities. Strait of Hormuz: 1. US President Trump: We control the Strait of Hormuz. 2. Iran and Oman will brief on the results of navigation negotiations in the Strait of Hormuz. 3. British media: The US restricts air defense hours for oil tankers passing through the Strait of Hormuz. 4. US Central Command: 100 ships have been diverted in the past 60 days. 5. According to Bahrains National News Agency: Bahrain stated it will not participate in the meeting with Iran regarding the Strait of Hormuz. 6. Iranian media, citing sources: The agreement reached between Iran and Oman does not mean the Strait of Hormuz is open. Other Matters: 1. BRICS countries call on Middle Eastern countries to exercise maximum restraint. 2. Iranian Embassy in India: The Iranian President met with the Crown Prince of Abu Dhabi in New Delhi, India. 3. The Iraqi Foreign Minister spoke with the Iranian Foreign Minister to discuss the closure of border crossings and the attack on Saudi Arabia. 4. The head of the Atomic Energy Organization of Iran departed for Vienna to attend the IAEA General Assembly and meet with representatives from multiple countries. 5. The Iraqi military stated that Iraq agreed to Irans request to jointly investigate the existence of drone launchers along the border between the two countries. 6. Trump stated that the war will end soon; Iran may be responsible for the attack on the Saudi pipeline; the Houthis do not want to fight us. 7. Iraqi military sources stated that the Taib border region between Iraq and Iran has been closed after the drone launch site was discovered. 8. Ibrahim Aziz, Chairman of the National Security Committee of the Iranian Parliament, stated that there are no negotiations. Negotiations are meaningless unless Irans conditions are met. 9. The head of the Bushehr Airport Authority in Iran stated that after a six-month hiatus, Bushehr Airport resumed its first international flight, the Bushehr-Dubai route operated by Qeshm Airlines.On September 13th, it was reported that the Houthi rebels in Yemen have recently intensified their offensive against government forces and seized control of strategic locations in the Red Sea. Experts analyze that changes in the balance of power within Yemen and the conflict between the United States and Iran are the reasons for the rapid escalation of the conflict in Yemen. Li Zixin, assistant researcher at the China Institute of International Studies, stated that firstly, since the sudden escalation of the current Israeli-Palestinian crisis in October 2023, the Houthi rebels have frequently conducted military operations in the Red Sea under the pretext of supporting Hamas. During this process, the Houthis have continuously trained in missiles, drones, and cross-sea strikes, and have also cooperated to a considerable extent with regional allies, gradually enabling them to operate on multiple fronts. Secondly, since the UN-mediated ceasefire agreement in 2022 failed to be renewed, the various factions within the Yemeni government forces have never been able to effectively integrate. Currently facing multiple Houthi attacks, the US forces are almost instantly routed, with some even retreating before the battle even begins. Within nine days, they have lost several strategic locations, including the Mukha and Hanish Islands, surrendering areas once largely controlled by the government forces to the Houthis. Thirdly, with the US deeply mired in the war against Iran, the Houthis have precisely seized upon this power vacuum.On September 13, U.S. Under Secretary of Defense for Acquisition and Sustainment, Duffy, recently urged Congress to expedite the approval of the Trump administrations $1.5 trillion defense budget for fiscal year 2027 to allow the U.S. military to replenish its stockpiles of critical weapons and ammunition. Duffy stated that the Department of Defense has already signed procurement contracts with defense contractors and is awaiting funding to meet the needs of warfighters. The Pentagon will work with Congress in the coming months to ensure all defense projects receive full funding.On September 13, the Canadian Prime Ministers Office announced that Prime Minister Mark Carney will visit Strasbourg, France, and Liverpool, UK, from September 15-17. The announcement stated that the Canadian government is building diverse partnerships. In France, Carney will address the European Parliament at the invitation of European Parliament President Jean-Michel Mezzola, attend European Commission President Ursula von der Leyens State of the Union address, and meet with MEPs to strengthen ties between Canada and the EU in trade, investment, and security. In the UK, Carney will hold his first meeting with Prime Minister Burnham to discuss priorities in bilateral relations, particularly in defense, energy, artificial intelligence, and critical minerals.On September 13, Iraqi Deputy Prime Minister and Foreign Minister Fuad Hussein spoke by phone with Iranian Foreign Minister Araqchi on September 12, local time. According to the Iraqi Foreign Ministry, the two sides discussed the reasons for Iraqs recent temporary closure of some border crossings with Iran and the subsequent arrangements, and exchanged views on the attacks on Saudi Arabia and the progress of related investigations. They also discussed a regional conference planned for Oman. Member states of the Gulf Cooperation Council, Iraq, and Iran will participate, focusing on issues related to the Strait of Hormuz. Hussein stated that Iraq supports holding the conference and will send a delegation. The two sides also exchanged views on the situation in Yemen and expressed their commitment to easing regional tensions through dialogue and negotiation.

Ahead of preliminary US S&P PMI data, the XAU/USD remains sideways below $2,000, according to our Gold Price Forecast

Alina Haynes

Apr 20, 2023 13:49

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In the early European session, the Gold price (XAU / USD) is exhibiting erratic movements near $1,994.00. The precious metal is in a state of indecision as investors await the release of preliminary S&P PMI data for the United States on Friday.

 

After violent swings influenced by the Federal Reserve's (Fed) Beige Book, the US Dollar Index (DXY) is showing signs of volatility contraction below 102.00. The declining trend of advances to consumer and business loans by U.S. commercial banks has intensified concerns of a recession in the U.S. economy, despite the fact that economic activity in 12 Fed districts remained virtually unchanged. To prevent a decline in asset quality, banks have tightened credit disbursement requirements.

 

In the meantime, S&P futures have recorded sizeable losses during the Asian session, as investors are wary of firms' comments regarding revenue guidance. The market anticipates that constrained credit conditions will impact the working capital management of cash-reliant companies, thereby affecting their output.

 

The market expects preliminary US S&P PMI data to reveal a Manufacturing PMI reading of 49.0, a decrease from the previous reading of 49.9. The Services PMI is anticipated to decrease to 51.5 from 52.6 previously reported.