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On July 29th, Chen Feihong, a member of the Party Committee and First-Level Inspector of the Shenzhen Financial Regulatory Bureau, revealed at the bureaus press conference for the first half of 2026 that the bureau continued to leverage its real estate financing coordination mechanism. As of the end of June, banks under its jurisdiction had approved 443 "whitelist" projects and issued loans totaling 436.524 billion yuan. Simultaneously, the bureau actively collaborated with departments such as housing and construction to jointly advance key urban renewal projects.The Federal Statistical Office of Germany reported that German import prices rose 6.1% year-on-year in June (market expectation: 6.0%). Import prices fell 0.7% month-on-month in June (market expectation: 0.7%).The yield on Japans 30-year government bonds fell 6 basis points to 3.92%.On July 29th, Gordon Shannon, co-head of investment-grade at TwentyFour Asset Management, stated in a report that investors should expect the Federal Reserve to adopt a "tightening hold" approach at its meeting, while still maintaining a considerable probability of a rate hike. Although he anticipates a 25-50 basis point rate hike later this year, the moderate CPI inflation in June and weak employment growth suggest the committee can wait for more data.July 29th - The Peoples Bank of China released its credit allocation data for the first half of the year yesterday (July 28th). In the first half of the year, RMB loans increased by 10.72 trillion yuan. Analysis of loan allocation reveals a significant structural change in credit flows during the first half of the year. Traditional real estate loan growth slowed, while loans focused on areas such as technological innovation saw impressive growth, indicating that financial resources are rapidly converging on new productive forces such as science and technology innovation and new infrastructure for computing power.

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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