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On October 23, a presentation from Heineken revealed that the company has urged UK pubs and restaurants to adapt to the surge in the use of weight-loss drugs, or risk losing customers and revenue. This is a rare admission from a major alcohol producer that GLP-1 inhibitors pose a threat to beer sales. Research by JPMorgan Chase shows that approximately 10 million people in the US used Novo Nordisks semaglutide drugs Ozempic and Wegovy last year. The widespread use of these drugs is having a ripple effect on the consumer goods industry, including reducing consumer cravings for sweets and snacks, increasing demand for clothing alterations, and prompting companies to rush into launching products that alleviate drug side effects. Heineken is the worlds second-largest beer manufacturer, after Anheuser-Busch InBev. Heineken told its catering and pub industry clients that GLP-1 inhibitors may reduce the willingness to drink and put pressure on beer and cider sales by making consumers feel full more easily and reducing consumption. The company also warned that the traditional consumption scenario of drinking multiple pints of beer at a time may become increasingly unsustainable.Bank of Japan: Rising raw material and energy prices appear to be putting downward pressure on profits, especially for small and medium-sized enterprises (SMEs). Some companies are relatively sensitive to rising crude oil prices.Bank of Japan: Ultra-long-term mortgages with maturities exceeding 35 years are increasing.Rio Tinto: Invests $1.9 billion in Conway South bauxite project.Bank of Japan: The possibility of increased concentration in private equity fund portfolios warrants attention.

As US economic data is reviewed, XAU/USD slips off $1,740 support-turned-resistance

Daniel Rogers

Aug 30, 2022 11:47

 截屏2022-08-04 下午5.12.51_1024x576.png

 

During Tuesday's Asian session, the gold price (XAU/USD) retests its intraday low near $1,736 after a failed rebound off the one-month low. In doing so, metal prices take cues from the most recent comeback of the U.S. dollar from its intraday low and justify the challenges to market mood originating from China and the central bankers' front.

 

The US Dollar Index (DXY) rebounded from the daily low to 108.81 after reversing from a new 19-year high the day before. In doing so, the dollar's index against the six main currencies appears to validate the market's fears of higher interest rates despite the imminent economic downturn, as Fed Chair Jerome Powell had previously suggested.

 

It is important to note that rumors of an escalation in Sino-American tensions over Taiwan also impose downward pressure on the XAU/USD exchange rate, primarily since Beijing is one of the world's largest commodities consumers. The news further strengthens the dollar's appeal as a safe haven. Politico has reported that the Biden administration will ask Congress to authorize a $1.1 billion arms sale to Taiwan. Prior to it, the movement of US boats in the Taiwan Strait and the visits of American diplomats to Taipei provoked China.

 

In contrast, the most recent news from Bloomberg regarding the Eurozone's ability to combat the energy issue appears to challenge the XAU/USD bearish. "The European Union is on track to fulfill its gas storage filling goal two months ahead of schedule as the EU prepares for a harsh winter with Russia limiting supplies and surging energy prices ravaging the continent," Bloomberg reported.

 

Monday saw the consolidation of recent market movements amid a light economic calendar and contradictory Fed commentary. In spite of this, the Dallas Fed Manufacturing Business Index increased to -12.9 from -20.2, as anticipated, and -22.6 previously. Neel Kashkari, president of the Minneapolis Federal Reserve Bank, claimed that people now comprehend how serious we are about bringing inflation back to 2%.

 

Following a two-day uptrend to reestablish the monthly high, the 10-year US Treasury yields fall to 3.10% amidst these plays. With this, intraday gains for S&P 500 Futures are reduced.

 

Moving forward, the August US Consumer Confidence and statements from Fed speakers are highlighted as the primary drivers to watch for additional impetus. In his Jackson Hole speech, Fed Chair Powell voiced concern over economic slowdown and labor market pressures. Consequently, Friday's US employment report will garner a great deal of attention.


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