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On January 11, Mitsubishi Motors President Takao Kato was interviewed on January 10. Regarding whether to join the management merger consultation between Honda and Nissan, he said "this is one of the options." Speaking of the envisioned benefits, Kato Takao said "We can actively get help in the North American business (where Mitsubishi Motors has no production base)." Kato Takao also pointed out that in terms of in-vehicle software development, "there will also be scenarios where the technical strength of the two companies will be utilized, which will be very beneficial." Honda and Nissan announced the full launch of management merger consultations in December last year. Mitsubishi Motors previously stated that it will decide whether to join the consultations around the end of January.On January 11, CICC commented on the US non-farm data. The team believes that the highlight of this time is the recovery of the service industry. The service industry has added 231,000 jobs, which has become the main driving force. Judging from the market reaction, the unexpected non-farm data has pushed the US Treasury bond interest rate and the US dollar to a new high, which is also in line with its judgment since the fourth quarter of last year: it believes that the US dollar is still strong and that interest rate cuts should be "done in reverse". When the interest rate cut is realized, it will be the low point of the US Treasury bond interest rate, rather than continuing to look at the recession and the starting point of the downward interest rate.German Geoscience Research Center GFZ: A 5.5-magnitude earthquake occurred in Ethiopia.On January 11, according to AFP, US President Biden condemned Metas plan to terminate its third-party fact-checking on the 10th, calling the decision "shameful." Biden told reporters at the White House, "This goes against everything America is about." It is reported that after Meta terminates its third-party fact-checking plan, it will switch to a user-written community annotation model. The plan will be implemented first in the United States, replacing the fact-checking service previously conducted by independent third parties.The Dow Jones Industrial Average closed at 41,938.45 on January 10 (Friday), down 696.75 points, or 1.63%. The S&P 500 closed at 5,827.04 on January 10 (Friday), down 91.21 points, or 1.54%. The Nasdaq Composite closed at 19,161.63 on January 10 (Friday), down 317.25 points, or 1.63%.

Forecast for Gold Price: XAU/USD surpasses $1,650 on falling wedge breakthrough; US PCE inflation observed

Daniel Rogers

Sep 30, 2022 10:46

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Gold price (XAU/USD) is anticipating its first weekly increase in three weeks as metal investors push $1,663 following the confirmation of the falling wedge bullish chart pattern the day before. In doing so, gold celebrates a weaker U.S. dollar but disregards the market's dismal conditions.

 

Consequently, the US Dollar Index (DXY) recorded another negative day, reestablishing the weekly low around 111.95. After the latest readings of the US Gross Domestic Product (GDP) for the second quarter confirmed the early projections of -0.6%, the greenback fell against the six major currencies.

 

It should be noted that the firmer printing of the US Weekly Initial Jobless Claims, which fell to 193K for the week ending September 24 compared to 209K before (updated from 213K) and the market's forecast of 215K, may have also weighed on the DXY. The US Initial Claims for Unemployment fell to their lowest level since April.

 

While respecting the data, St. Louis Federal Reserve Bank President James Bullard praised the decline in weekly Initial Jobless Claims and stated, "We will push inflation to 2% in a reasonable compact time frame." Elsewhere, Federal Reserve Bank of Cleveland President Loretta Mester stated on Thursday that they are not yet in a position to consider stopping interest rate hikes.

 

In addition to the Fed's aggressive rhetoric, anxieties originating from the United Kingdom, Russia, and China also test sentiment and the XAU/USD bulls, but they were unable to halt the price decline.

 

It's hard to avoid the conclusion that fiscal easing announced will prompt a significant and necessary monetary policy response in November," said Bank of England Chief Economist Huw Pill. On the other hand, record high German inflation, Russia's willingness to annex more parts of Ukraine, and the chatter over China's inability to tame its recession woes were also challenging the risk appetite.

 

As a result of these bets, Wall Street benchmarks reversed all Wednesday gains, while Treasury yields recovered.

 

Traders will pay special attention to the Fed's preferred inflation gauge, namely the Core Personal Consumption Expenditures (PCE) Price Index for September, which is anticipated to increase 4.7% year-over-year compared to the prior reading of 4.4%. If the actual outcome is stronger than anticipated, the XAU/USD exchange rate may struggle to rise.

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