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May 21 – A survey released on Thursday showed that UK factory orders saw their biggest drop since September 2020 this month, while sales price expectations also rose sharply. This situation highlights the predicament facing the Bank of England. Data from the Confederation of British Industry (CBI) showed that the UK industrial orders balance in May was -41, the lowest since September 2020; while the industrial price expectations balance was 38, the highest since February 2023. Cameron Martin, senior economist at the CBI, said that in an increasingly uncertain global environment, the Middle East conflict is causing energy costs to rise and triggering further supply chain disruptions, posing new challenges to manufacturers already facing weak demand. The Bank of England is currently closely monitoring the situation to determine whether it needs to raise interest rates to eliminate inflationary pressures caused by the energy price shock triggered by the war with Iran, or whether the decline in demand means that any rise in the overall inflation rate is only temporary.The UKs CBI industrial orders balance fell to -41 in May, the lowest level since September 2020. Meanwhile, the UKs CBI industrial price expectations balance rose to 38 in May, the highest level since February 2023.The UKs CBI industrial price expectations balance for May was 38, compared to 32 in the previous month.The UKs May CBI industrial orders balance was -41, compared to an expected -40 and a previous reading of -38.Iranian Foreign Minister Araqchi: If it is necessary for us to be present in the fields of diplomacy, dialogue and negotiation for the benefit of the regime, we will be there with the same strength as the armed forces are in defending the country.

Gold Price Prediction: The XAU/USD pair will fall below $1870 as yields rise ahead of Fed Chair Powell's speech

Alina Haynes

Jan 10, 2023 14:55

截屏2023-01-09 下午5.31.06_1024x576.png

 

In the Tokyo session, the gold price (XAU/USD) has fallen below the immediate resistance of $1,870.00. The precious metal has broken through the consolidation formed in the band of $1,870.00-1,881.50 as demand for US government bonds deteriorates ahead of the speech by Federal Reserve (Fed) chairman Jerome Powell on Tuesday.

 

The 10-year US Treasury yields have risen beyond 3.54 percent, dampening risk appetite. Meanwhile, S&P500 futures have become volatile following a sell-off late in Monday's session, signaling caution in establishing positions in risky assets. The US Dollar Index (DXY) is anticipated to attempt a break above the immediate resistance of 103.00 into the auction area.

 

Investors anticipate Fed Powell's speech for fresh cues, as it will provide a head start for the entirety of CY2023. Despite a sharp reduction in December wage inflation, some Fed policymakers continue to endorse a terminal rate prediction of 5.00-5.25%.

 

Mary Daly, president of the San Francisco Fed Bank, argued that interest rates between 5% and 5.25 percent are fair. Also, the president of the Atlanta Federal Reserve bank, Raphael Bostic, anticipates an interest rate peak in the range of 5% to 5.25 percent and the continuation of higher interest rates through CY2023.

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