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Real-time News
September 18th - U.S. factory output unexpectedly declined in August, impacted by rising input costs and a slowdown in equipment production. Data released Friday showed manufacturing output fell 0.3%. A survey of economists had previously indicated a median market expectation of 0.3% growth. Total industrial output, including mining and utilities, was flat. Utility output rose 1.8%, while mining output saw a slight increase. The slowdown in August factory output marks a temporary halt to this years production recovery, which was largely driven by robust capital spending and strong consumer demand. However, producers are facing rising costs of oil and other raw materials, as well as supply chain disruptions caused by the wars in the Middle East and Ukraine. The report also showed that after strong growth in previous months, equipment production fell 0.5%, and defense and aerospace equipment production fell 1.2%. Production of building materials and computer and electronic products also declined.On September 18, the Iraqi Ministry of Transportation announced in a statement that it had returned restricted airspace in the west to civilian authorities, ending restrictions imposed since 2016 for military operations. The ministry stated that all previously reserved areas stretching across western Iraq from north to south have been handed over to agencies responsible for airports and air navigation for civilian use. This move is expected to provide Iraqi aviation authorities with more space to reroute flight routes, ease restrictions on aircraft flights, and improve airspace utilization efficiency.Federal Reserve Governor Bowman will participate in a discussion on stress testing in ten minutes.The U.S. manufacturing capacity utilization rate was 75.7% in August, down from 76% in the previous month.U.S. manufacturing output fell 0.3% month-on-month in August, below the expected 0.30% and the previous reading of 0.20%.

Gold Price Prediction: XAU/USD continues to struggle above $1,840 as rates surge ahead of the release of the Fed's minutes

Daniel Rogers

Feb 21, 2023 15:15

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In the Tokyo session, the gold price (XAU/USD) is exhibiting a mediocre performance over $1,840. Prior to the release of the Federal Open Market Committee (FOMC) minutes, the precious metal is gauging a direction, but volatility is expected to remain low.

 

In anticipation of the restart of U.S. markets following a long weekend, investors' appetite for risk has diminished as uncertainty has increased. This has resulted in a further decrease in risky assets such as S&P500 futures. Prior to the FOMC minutes, the US Dollar Index (DXY) has rebounded to approximately 103.70 but is still in the woods. In the meantime, the alpha provided by 10-year US Treasury bonds has surpassed 3.86 percent.

 

The Consumer Price Index (CPI) is recalcitrant and may drive Federal Reserve (Fed) chair Jerome Powell to boost interest rates further to manage inflationary pressures, as seen by a recent improvement in US economic indicators that forecast inflation. For additional guidance, the FOMC minutes will be closely monitored.

 

Prior to that, however, the preliminary S&P Global PMI (Feb) statistics will be closely monitored. According to the consensus, the preliminary Manufacturing PMI (Feb) will fall to 46.8 from 46.9 before. Additionally, the Services PMI will be released at 46,6 as opposed to 46,8 previously.


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