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On September 13, the Islamic Republic News Agency (IRNA) reported, citing local Iranian officials, that an Iranian container ship was attacked by an unidentified projectile in the waters near the Strait of Hormuz, resulting in one death and four injuries.On September 13th, market observers stated that Anthropic executives call to slow down technological development could drag down chipmaker and supply chain stocks in the short term, but the long-term impact is likely to be limited as spending on computing infrastructure remains strong. Semiconductor manufacturers and other AI-related stocks are likely to be hit hardest in Mondays initial sell-off as investors assess whether a more cautious approach to developing advanced models will dampen earnings. However, given that demand for chips, energy, and computing power continues to outpace supply, any weakness is likely to be temporary. Investors, including Gary Tan, portfolio manager at Singapore-based Allspring Global Investments, are skeptical about a lasting impact on the industry. "This could create some short-term pressure, but its unlikely to derail the long-term AI deal. AI development is still in its relatively early stages, and Im not sure if the rest of the ecosystem is willing to accept the current hierarchy and slow down while the technology is still evolving so rapidly," he said.On September 13th, Ukrainian President Volodymyr Zelenskyy posted on social media that Russia had launched approximately 2,100 drones (many of which were Shahed drones) at Ukraine this week alone. In addition, Russia used nearly 1,700 glide bombs and 78 rockets of various types in an attempt to paralyze the Ukrainian economy and disrupt peoples lives. This night and this morning, energy, Ukrainian railways, businesses, and ordinary residences were attacked. The Russian military attacked Odessa with rockets and drones. Recovery work is still underway in many western regions following the nights attacks.On September 13, Russian State Atomic Energy Corporation (Rosatoburo) CEO Likhachev stated that Ukrainian forces deliberately attacked a convoy of oil tankers carrying diesel fuel for the Zaporizhia nuclear power plant at 2:28 PM on September 11. The attack resulted in the deaths of two Russian soldiers and injuries to several others. Likhachev said that Ukraines deliberate provocation regarding the nuclear power plant has unpredictable consequences. Ukraine has not yet responded.The U.S. National Hurricane Center reports that Norbert has strengthened slightly and is expected to dissipate east of Hawaii by mid-next week.

Gold Price Prediction: XAU/USD bears at $1,650 on Fed hawkishness and China news

Daniel Rogers

Sep 19, 2022 14:34

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During early Monday morning in Europe, the gold price (XAU/USD) maintains a position close to the intraday low at $1,670. In doing so, metal prices endure the weight of a stronger U.S. dollar amidst a sluggish session caused by Japanese and British vacations. The cause may be related to the Fed's hawkish bets and China-related news stories.

 

US Dollar Index (DXY) reverses a two-day slump while posting intraday gains of 0.18 percent at 109.85 as of press time. Indicators of the U.S. dollar's value versus the six major currencies have recently been buoyed by the University of Michigan's September consumer sentiment report and the market's positive expectations on the Fed's next move. Consequently, the probability of a 75-basis-point (bps) rate hike by the Federal Reserve increased to 80%, while the market's estimates of a one-percentage-point increase in the Fed rate rose to 20% at the latest.

 

US President Biden stated elsewhere, "I'm more positive than I've been in a long time." The national leader also claimed that inflation will be brought under control. On the same line are the covid updates from China, which have unlocked Dalian and Chengdu while observing zero coronavirus cases in Beijing and one, as opposed to zero the day before, outside of Shanghai's quarantine zone. However, US President Biden's willingness to support Taiwan in the event that China assaults Taiwan and hawkish expectations for the Federal Reserve appear to weigh on the steel price ahead of the major monetary policy pronouncements.

 

In addition, the People's Bank of China (PBOC) reduces the 14-day reverse repo rate by 10 basis points to 2.15 percent. "With no maturing reverse repos on Monday, the Chinese central bank injects 12 billion yuan," reports Reuters. The same might have indicated that the dragon nation is not in recovery mode and requires more rate cuts than rate raises, which could have caused the gold price to plummet. The cause is China's position as one of the world's largest gold consumers.

 

In light of this, the S&P 500 Futures post modest losses while mirroring Wall Street's Friday close. Notably, the selling in Japan curbs bond movements in Asia, but yields are robust near the multi-day high due to fears of a recession and hawkish Fed views.

 

Moving forward, a light economic calendar and important market holidays may limit intraday XAU/USD price fluctuations. However, bears are expected to maintain control because to aggressive Fed expectations, which, if dashed, might defy the bearish chart pattern and spark the long-awaited rally.

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