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On October 24th, Moodys maintained Frances sovereign credit rating at Aa3, refraining from a downgrade, but warned that slowing economic growth, a widening fiscal deficit, rising financing costs, and social protests could hinder fiscal consolidation. Frances fiscal deficit this year is projected to reach 5.4% of GDP, and the government plans to reduce the deficit to 5% by 2027, but the budgets passage remains uncertain due to a lack of parliamentary majority support. The French National Assembly rejected the revenue portion of the 2027 social security budget on Friday, and the main budget will continue to be reviewed next week. French bond market pressures persist, with yields rising among the highest of developed economies this month, reaching a 24-year high; the spread between French and German 10-year bond yields widened to 178 basis points on Thursday, compared to 85 basis points in early September. France has also recently been downgraded by Scope, and Morningstar DBRS revised its outlook to negative; S&P is expected to update its rating on November 27th.Barclays: Inventory depletion and recovering demand are tightening the spot market. Despite policy efforts to ease diesel supply shortages, short-term oil price risks remain clearly skewed to the upside.Barclays: The conflict with Iran is unlikely to subside quickly, further tightening the already tense spot oil market.On October 24th, Cuban Foreign Minister Rodriguez refuted the USs claim that Cuba would be "settled incidentally" after the war with Iran, stating on the 23rd that Cuba rejects all threats from the US. Rodriguez stated on social media that Cubas coast has beautiful beaches as well as jagged reefs, and it will not be friendly to those who come with hostility and a desire for conquest. Earlier that day, US President Trump, at a campaign rally in Florida, claimed that the US was prepared to "settle down" the Cuban issue after ending the war with Iran.The Central Bank of Brazil approved several resolutions to strengthen the responsibilities of financial institutions in providing and disbursing credit.

Gold price forecast: The XAU/USD rebounds on reports of a lower US dollar and a return to risk-on

Daniel Rogers

Aug 12, 2022 11:51

截屏2022-06-07 下午5.14.07.png 

 

Gold recovers from an intraday drop to the $1,784–$1,783 range and reaches a new daily high during the early North American session. But bulls are having trouble capitalizing on the trend and pushing XAU/USD back above $1,800.

 

Gold prices in dollars is supported by the fact that the US dollar is having a hard time finding buyers and is still very close to its lowest level since late June. Investors cut their wagers on a 75 bps rate hike by the Federal Reserve at the September policy meeting after US consumer inflation data reported on Wednesday came in lower than expected. The dollar is further weakened, and the non-yielding yellow metal gains in value, as a result of this and a new leg down in US Treasury bond yields.

 

For the time being at least, the risk-on sentiment restrains additional advances for the safe-haven gold. Inflation fears persist, but there are some indicators that the rate of increase may have plateaued. This has led to calls for the US central bank to ease up on its policy tightening. This coming Thursday's announcement of the US Producer Price Index (PPI) will further reinforce market expectations and bolster investor confidence. The commodity is facing a headwind due to the robust performance of the equity markets.

 

Gold's potential gains could be limited by the fact that the Federal Reserve is widely predicted to raise interest rates by at least 50 basis points in September. To prepare for any additional appreciating rise, it would be advisable to wait for some follow-through buying beyond the $1,808 level, a five-week high set on Wednesday. However, the intraday rebound from the 50-day SMA's solid support floor favors optimistic traders and indicates that any significant retreat may still be considered as a buying opportunity.

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