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Market News International gold prices have fallen from a two-month high, the U.S. index rebounded, and investors turned their attention to it
International gold prices have fallen from a two-month high, the U.S. index rebounded, and investors turned their attention to it
On November 8, the international gold price fell after hitting a new high of US$1821.09 per ounce since September 7, as the US dollar index rebounded. But investors insisted that major central banks will keep interest rates low for the time being, and their focus turned to important US inflation data to be announced later this week.
2021-11-08
10389
On Monday (November 8), the international gold price fell after hitting a new high of US$1821.09 per ounce since September 7, as the US dollar index rebounded. But investors insisted that major central banks will keep interest rates low for the time being, and their focus turned to important US inflation data to be announced later this week.
At 15:49 GMT+8, spot gold fell 0.09% to US$1816.70 per ounce; the main COMEX gold contract rose by 0.09% to US$1818.5 per ounce; the U.S. dollar index rose 0.10% to 94.314.
The major central banks insisted last week that the current inflationary pressures would ease, which undermined the prospects of accelerated interest rate hikes in major global economies. But they also acknowledged that global supply bottlenecks raise the risk of upward pressure on prices for longer periods of time. Market participants are now turning their focus to the US consumer price index to be announced this Wednesday (November 10).
U.S. President Biden praised Congress for passing the long-delayed $1 trillion infrastructure bill on Saturday, calling it a "one-time-only investment in a generation" and expects that despite the tensions in negotiations, a broader social security program will receive approve. During the COVID-19 pandemic, the ultra-loose fiscal policies introduced by various countries pushed up inflation expectations and raised the charm of gold prices to fight inflation.
It remains to be seen whether the current wave of price increases is a short-term phenomenon affected by temporary factors after the epidemic, or whether it heralds the beginning of a new upward trend. The Fed announced last week its plan to reduce the size of its monthly bond purchases, but it did not trigger market “panic”. If inflation data is strong and speculation about interest rate hikes is rekindled, the situation may change.
IG Markets analyst Kyle Rodda said: "Inflation data must be significantly higher than expected in order to regain fear of raising interest rates, but as long as it meets or slightly higher than expected, I don't think no one will panic."
Rodda said that if it breaks through US$1,830, it may push the price of gold to rebound to US$1,900. However, in the long run, as central banks eventually tighten policies to control high inflation, gold prices may show a downward trend.
But Jeffrey Halley, senior market analyst at OANDA, said in a report that the rise in gold prices may have attracted "a common swarm of trend followers and fast-money buyers." "If judged by past performance, these positions None of them are'sticky'. Once the price of gold starts to fall, those quick money buyers will quickly flee and sell, causing the price of gold to fall again."
A U.S. Federal Court of Appeals ruled on Saturday to suspend the implementation of the Biden administration's new crown vaccine injunction on the grounds that the rule has "serious legal and constitutional" issues. The injunction requires employees of US companies with at least 100 employees to be vaccinated or tested weekly.
Some people worry that the White House's vaccination regulations may exacerbate the shortage of workers. Although the US non-agricultural employment data released last Friday (November 5) was better than expected, it is unlikely to change the Fed’s dovish stance. The Fed’s decision is still measuring how close the economy is to the Fed’s goal of achieving full employment.
A report released last week by Challenger, Gray & Christmas, a global employment agency, showed that the number of layoffs announced by US employers in October increased by 27.5% to 22,822, the highest level since May. It stated that 22% of the layoffs were due to workers' refusal to be vaccinated as required by the company.
Ryan Sweet, senior economist at Moody’s in West West, Pennsylvania, said: “This issue may force people to exit the labor market or slow down their return to the labor market because people will expand their search and find non-compliance. Employers or workplaces where regulations do not apply."
At 15:49 GMT+8, spot gold fell 0.09% to US$1816.70 per ounce; the main COMEX gold contract rose by 0.09% to US$1818.5 per ounce; the U.S. dollar index rose 0.10% to 94.314.
The major central banks insisted last week that the current inflationary pressures would ease, which undermined the prospects of accelerated interest rate hikes in major global economies. But they also acknowledged that global supply bottlenecks raise the risk of upward pressure on prices for longer periods of time. Market participants are now turning their focus to the US consumer price index to be announced this Wednesday (November 10).
U.S. President Biden praised Congress for passing the long-delayed $1 trillion infrastructure bill on Saturday, calling it a "one-time-only investment in a generation" and expects that despite the tensions in negotiations, a broader social security program will receive approve. During the COVID-19 pandemic, the ultra-loose fiscal policies introduced by various countries pushed up inflation expectations and raised the charm of gold prices to fight inflation.
It remains to be seen whether the current wave of price increases is a short-term phenomenon affected by temporary factors after the epidemic, or whether it heralds the beginning of a new upward trend. The Fed announced last week its plan to reduce the size of its monthly bond purchases, but it did not trigger market “panic”. If inflation data is strong and speculation about interest rate hikes is rekindled, the situation may change.
IG Markets analyst Kyle Rodda said: "Inflation data must be significantly higher than expected in order to regain fear of raising interest rates, but as long as it meets or slightly higher than expected, I don't think no one will panic."
Rodda said that if it breaks through US$1,830, it may push the price of gold to rebound to US$1,900. However, in the long run, as central banks eventually tighten policies to control high inflation, gold prices may show a downward trend.
But Jeffrey Halley, senior market analyst at OANDA, said in a report that the rise in gold prices may have attracted "a common swarm of trend followers and fast-money buyers." "If judged by past performance, these positions None of them are'sticky'. Once the price of gold starts to fall, those quick money buyers will quickly flee and sell, causing the price of gold to fall again."
A U.S. Federal Court of Appeals ruled on Saturday to suspend the implementation of the Biden administration's new crown vaccine injunction on the grounds that the rule has "serious legal and constitutional" issues. The injunction requires employees of US companies with at least 100 employees to be vaccinated or tested weekly.
Some people worry that the White House's vaccination regulations may exacerbate the shortage of workers. Although the US non-agricultural employment data released last Friday (November 5) was better than expected, it is unlikely to change the Fed’s dovish stance. The Fed’s decision is still measuring how close the economy is to the Fed’s goal of achieving full employment.
A report released last week by Challenger, Gray & Christmas, a global employment agency, showed that the number of layoffs announced by US employers in October increased by 27.5% to 22,822, the highest level since May. It stated that 22% of the layoffs were due to workers' refusal to be vaccinated as required by the company.
Ryan Sweet, senior economist at Moody’s in West West, Pennsylvania, said: “This issue may force people to exit the labor market or slow down their return to the labor market because people will expand their search and find non-compliance. Employers or workplaces where regulations do not apply."
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