"At present, what the market is focusing on is not only whether the Fed will cut interest rates, but also the accompanying message. If the Fed takes a dovish stance and opens the door to a clear easing cycle, real yields will have room to decline, the USD will weaken, and gold will continue to find support. Conversely, a cautious or hawkish tone could trigger a short-term correction, even though the long-term trend may remain intact."
"Recent U.S. economic data continue to show mixed signals. CPI in August rose 0.4% m/m, pushing CPI y/y up to 2.9% from 2.7%, indicating that consumer inflation remains sticky. On the other hand, PPI fell 0.1% m/m, reflecting that input price pressures have eased. In addition, the preliminary Michigan consumer sentiment index for September came in well below expectations, while jobless claims showed that the labour market remains resilient."
"A divergence is emerging in investment flows: while global gold ETFs saw inflows of about USD 5.5 billion in August, bringing the year-to-date total to nearly USD 47 billion, investment demand in China has shown signs of stalling. Chinese gold ETFs recorded outflows of around RMB 6 billion (≈USD 834 million), SHFE gold futures trading volume dropped 26% m/m, and withdrawals from the Shanghai Gold Exchange reached only 85 tons, the lowest August level since 2010."
Gold surged to about USD 3,703/oz driven by monetary easing expectations and increased safe-haven demand. Global investors raised gold positions ahead of the September 18 FOMC meeting as focus shifted to both the likelihood of Fed rate cuts and the Fed's messaging. A dovish Fed could reduce real yields, weaken the USD, and sustain gold support, while a cautious or hawkish tone could prompt a short-term correction despite a favorable long-term trend. Recent U.S. data are mixed: CPI rose and remains sticky, PPI eased, consumer sentiment weakened, and labour-market indicators stayed resilient. Global ETF inflows contrasted with weakening Chinese investment demand and lower domestic volumes.
Read at London Business News | Londonlovesbusiness.com
Unable to calculate read time
Collection
[
|
...
]