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US President Trump: The United States is working to supplement and expand weapons production to strengthen U.S. defense manufacturing capabilities.On September 14th, Balaji Krishnamurthy, President of Chevron Australia, stated that liquefied natural gas (LNG) prices, which have surged since the outbreak of the Iraq War, are unlikely to decline in the short term. He said on Monday that he "doesnt see prices falling" in the next six months or so, noting that "Australian LNG currently enjoys a premium" due to Australias geographical proximity to Asia. The US oil giant operates the Gorgon and Wheatstone projects in Australia and has benefited from the price surge caused by the disruption of Qatari exports. Qatar previously accounted for about one-fifth of global LNG production. However, this has also led to some demand disruption in the short term, and there is a risk of declining consumption in the long term as countries seek alternatives to mitigate future supply shocks. Krishnamurthy stated that the rise of artificial intelligence will be a key source of LNG demand growth, presenting opportunities for Australian data centers. He added that the war has also led customers to increasingly seek long-term supply contracts, as energy security is now a top priority. He said, "In the short term, we will continue to see some demand adjustments," but "in the long term, the fundamentals, especially for LNG, remain very strong."Chevron Australia President: LNG prices are expected to remain high over the next six months.According to US financial media Semafor: US President Trump has agreed to allow states to file lawsuits against violations of the Clarity Act.On September 14th, the State Administration for Market Regulation (National Standardization Administration) approved and released four mandatory national standards for mine safety, including the "Specification for Survey of Hidden Disaster-Causing Factors in Mines" and the "Technical Conditions for Lithium-ion Power Batteries Used in Underground Mines," providing unified mandatory technical standards for mine risk prevention and equipment safety. These standards, formulated by the National Mine Safety Administration, will come into effect on March 1, 2027.

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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