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August 13th - The Pinglu Canal is nearing full navigation. A key project of the Western Land-Sea New Corridor, the Pinglu Canal is the first canal project connecting the Yangtze River and the sea built since the founding of the Peoples Republic of China. The Guangxi Zhuang Autonomous Region has consistently prioritized ensuring the timely, safe, and high-quality completion and opening of the canal by September, coordinating efforts at a high level and pushing forward with all its might. A special working group has been established to implement a list-based, meticulous, and closed-loop management system for tasks such as project completion and operational preparations, with weekly scheduling to ensure that all tasks are carried out in a coordinated manner and achieve tangible results. Systematic measures have been deployed to achieve the goal of "water in the canal, boats on the water, goods on the boats, and goods flowing in all directions."On August 13th, Shanghai issued the "Shanghai Action Plan for Implementing the Several Measures on Further Promoting the Development of Private Investment". The plan mentions providing computing power subsidies in accordance with laws and regulations to support private enterprises in renting intelligent computing resources for large-scale model research, training, and application. It also encourages universities, research institutions, and state-owned enterprises to use data storage and computing power resources built by various business entities, including private enterprises. The plan includes publishing and dynamically updating a public data open list to support private enterprises in the in-depth development and scenario-based utilization of specific public data. It promotes the issuance of "computing power vouchers," "model vouchers," and "corpus vouchers" to reduce the cost of using digital elements such as public data, computing power, models, and corpora. The plan also aims to cultivate benchmark enterprises and platform enterprises for urban digital transformation and guide private enterprises to participate in the construction and scenario operation of digital transformation projects in transportation, logistics, and public services. Finally, it encourages private enterprises to build demonstration projects for new infrastructure such as blockchain applications and large-scale robot applications.On August 13, Minister of Ecology and Environment Huang Runqiu stated at a press conference held by the State Council Information Office on the theme of "Starting the 15th Five-Year Plan" that my countrys ecological environment quality has continued to improve this year, with major indicators showing significant improvement. From January to July, the national concentration of fine particulate matter (PM2.5) decreased by 1.8 micrograms per cubic meter year-on-year, a decrease of 6.2%; the proportion of days with good air quality increased by 3.9 percentage points year-on-year. The proportion of surface water sections with water quality of Class I to III reached 86.5%, an increase of 2.4 percentage points year-on-year.On August 13th, Capital Economics economist Marcel Thieliant stated that while South Koreas GDP growth faces upside risks in the short term, the semiconductor-driven economic boom in South Korea may lose momentum within the next two years. The economist predicts that the US AI investment boom will cool down by 2028, potentially prompting South Korean chipmakers to begin cutting capital expenditures, given the highly cyclical nature of the semiconductor industry. Thieliant noted that Samsung Electronics and SK Hynix announced an 800 trillion won investment plan to build a new chip manufacturing plant in southwestern South Korea, but a specific investment timeline has not yet been announced. He pointed out that in 2023, as the post-pandemic electronics boom reversed, SK Hynix cut its capital expenditures by two-thirds.The yield on Japans 30-year government bonds rose 1.0 basis point to 4.000%.

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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