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December 17th - ING Senior Economist Min Joo Kang wrote in a report that the Bank of Japan is more likely to raise interest rates on Friday due to strong Japanese exports. Exports rose for the third consecutive month in November, and core machinery orders surged for the second consecutive month in October. The data suggests the economy is recovering from the contraction of the previous quarter. The market will be watching comments from Bank of Japan Governor Kazuo Ueda. Given growing concerns about rising market interest rates, we expect Ueda to refrain from delivering any hawkish messages at the press conference.Yaojie Ankang-B (02617.HK) saw its gains widen to 20%, with the share price currently at HK$176.1.December 17th - Analyst Eamonn Sheridan stated that todays Japanese trade and investment data reinforced expectations that the Bank of Japan will raise interest rates by 25 basis points this week. After contracting last quarter, signs of economic recovery continue to strengthen. Japans exports rose for the third consecutive month in November, increasing by 6.1% year-on-year, easily exceeding market expectations. Strong demand in the US and Europe, along with a recovery in global semiconductor demand following the US trade agreement, drove this rebound. Exports to the US grew by 8.8%, and exports to the EU increased by nearly 20%, highlighting improved external momentum.According to futures market news on December 17th, as of the week ending December 13th, Japanese commercial crude oil inventories decreased by 464,387 kiloliters from the previous week to 10,223,572 kiloliters. Japanese gasoline inventories decreased by 14,171 kiloliters from the previous week to 1,714,382 kiloliters. Japanese kerosene inventories decreased by 98,423 kiloliters from the previous week to 2,272,809 kiloliters. The average operating rate of Japanese refineries was 90.8%, compared to 86.1% the previous week.December 17th - According to The Information, sources familiar with the matter revealed that OpenAI is in talks to raise at least $10 billion in investment from Amazon (AMZN.O) and use its AI chips. This deal could bring a new customer to Amazons Trainium chip, a competitor to Nvidias (NVDA.O) AI accelerator.

Forecast for Gold Price: XAU/USD corrects to near $1,970 on UBS-Credit Suisse deal; Fed policy observed

Daniel Rogers

Mar 20, 2023 13:16

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After UBS announced Credit Suisse's rescue plan, the gold price (XAU / USD) corrected to near $1,970. The precious metal is estimating a cushion near the $1,970.00 support, but further correction appears likely.

 

Investors should be aware that market participants have been pouring funds into the yellow metal as a hedge against the volatility associated with a potential banking crisis. The UBS acquisition has mitigated concerns of a global banking crisis. The purchase agreement has signaled that central banks are willing to provide assistance to commercial banks in an effort to restore investor confidence.

 

The US Dollar Index (DXY) is fluctuating around 103.80 as the market anticipates the Federal Reserve's (Fed) interest rate decision on Wednesday. The analysts at Danske Bank anticipate that Federal Reserve Chair Jerome Powell will raise interest rates by 25 basis points (bps) despite the recent turmoil and banking sector concerns.

 

S&P500 futures have erased the majority of their morning gains, indicating that the UBS-Credit Suisse agreement is insufficient to calm global banking fears. As the banking debacle has yet to reveal its true colors, negative market sentiment would persist for some time. In the meantime, the UBS-Credit Suisse merger has reduced demand for US government bonds, which were previously regarded as safe-haven investments. This has increased 10-year US Treasury yields to 3.46 percent.


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