The international gold price has risen for four consecutive days, but the outlook for the bulls is worrying, worrying that the FED will renew the position
On Thursday (February 9), international gold prices rose for the fourth consecutive trading day, as the U.S. dollar index weakened once more, but the outlook for gold prices remained cloudy as several Fed officials said that further interest rate hikes were needed to curb inflation, although no one suggested The Fed will return to a more aggressive monetary policy stance.
At 14:59 Beijing time, spot gold rose 0.29% to $1,880.75 an ounce; the main COMEX gold futures contract rose 0.10% to $1,892.5 an ounce; the U.S. dollar index fell 0.22% to 103.253.
Federal Reserve officials said on Wednesday (February 8) that further interest rate hikes are likely as the central bank works to bring down inflation. Although no one suggested that January’s torrid non-farm payrolls report might prompt them to return to a more aggressive monetary policy stance.
Fed Governor Waller said that although wage growth has slowed, the decline is “not enough” and that “the Fed will need to maintain a tight monetary policy stance for some time.” “.
New York Fed President William Williams emphasized that interest rates have “barely entered a restrictive zone” and that interest rates need to be “remained at restrictive levels for several years to ensure that inflation is controlled at 2%.” Minneapolis Fed President Neil Kashkari emphasized that “the service sector in the U.S. economy is still hot” and that inflation in the core services sector other than housing has been lacking.
JPMorgan Chase & Co chief executive Jamie Dimon warned once morest prematurely declaring victory in the fight once morest inflation. He also warned that the Fed might raise interest rates above 5% if rising prices turn out to be “sticky.” He further added that if the inflation rate does not fall to 3.5%, the Fed rate must exceed 5%.
Investors will be closely watching the U.S. Labor Department’s consumer price report due next week for clues on the Federal Reserve’s future monetary policy stance. Market participants expect the Fed’s target rate to peak at 5.128% in July, up from a previous forecast of less than 5%.
Bulls appear to lack confidence, TD Securities economists report. “Traders are likely to be unwinding positions at a slower pace as current gold positioning is slightly below average. This leaves investors as marginal buyers or sellers, and once morest this backdrop, the market will increase focus on upcoming data releases The price of gold is not expected to fall sharply before it falls below the $1,840 range, but if the price of gold breaks through $1,900, the margin of safety for the marginal buying plan is very small. Therefore, although the price of gold is still overbought, if there is no data to confirm that the central bank will change in the future To be more hawkish, we don’t see a fall in gold prices.”
