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The U.S. industrial production monthly rate for March will be released in ten minutes.Federal Reserves Williams: The improvement in commercial real estate has exceeded expectations, and the risks have diminished.Federal Reserves Williams: We are seeing a large number of office spaces being converted into residential use.Federal Reserves Williams believes the New York area economy is showing strong vitality.On April 16th, New York Federal Reserve President Williams reiterated that monetary policy remains well-positioned to address the threat of a prolonged supply shock from the Middle East conflict, which could push up inflation and dampen growth. He stated that if energy disruptions ease quickly, the impact of the conflict could be partially reversed this year, but a prolonged crisis would have more severe consequences. The war has already pushed up inflation and dampened economic activity through soaring intermediate costs and commodity prices. While underlying inflation is moving in the "right direction," upward price pressures have already been transmitted to goods and services beyond energy, such as airfares, food, and fertilizers. Williams stated that the current monetary policy stance balances the risks to employment and inflation targets. Several Fed officials have previously indicated their preference to keep interest rates unchanged at the April 28-29 Washington meeting. Williams projects US economic growth of 2%-2.5% this year, with an unemployment rate of approximately 4.25%-4.5%, but contradictory labor market signals; he also expects inflation to be between 2.75%-3% this year, falling back to 2% by 2027.

Before the US PMI is released, the gold price is expected to rise beyond $1,740 per ounce

Daniel Rogers

Aug 23, 2022 14:48

 截屏2022-08-22 下午5.31.01_1024x576.png

 

On the back of conflicting forecasts for US Purchasing Managers Index (PMI) data, the gold price (XAU/USD) is trying to break above $1,740.00. A new monthly low of $1,727.85 was recorded for the precious metal on Monday, but it has since rallied strongly. Given the lack of impetus in the upward trend, the gold price is likely to stay volatile. However, a pullback may be less profitable.

 

The consensus for the S&P Global Manufacturing PMI is 51.5, which is down from the prior reading of 52.2. When compared to its previous reading of 47.3, the Services PMI has room to grow.

 

The yellow metal has been supported by the disappointing early estimates of US Durable Goods Orders. From a previous release of 2%, the market expects the economic figures to sharply decrease to 0.5%. It's important to note that the most recent reading showed no change in underlying pricing pressures, which stood at 5.9%. So, we expect to see little change, if any, in the Durable Goods Orders numbers. Unfortunately, a precipitous drop in economic statistics portends a precipitous drop in demand.

 

The other thing that will be in the spotlight is Federal Reserve (Fed) chair Jerome Powell's remarks from the Jackson Hole Economic Symposium. US economic conditions and Fed Powell's direction on inflationary pressures and interest rates will be determined by him.

 

Gold prices on an hourly scale are looking to continue their recovery after breaking above the $1,729.44 61.8% Fibonacci retracement (set from the low of $1,680.91 on July 21 to the high of $1,807.93 on August 10). Gold has been testing the resistance of the 20-period Exponential Moving Average (EMA) around $1,738.00; a sustained move above this level would signal a change in trend toward the bullish side.

 

Furthermore, the Relative Strength Index (14), which had been negative in the 20.00-40.00 range, has moved into the bullish 40.00-60.00 zone, indicating that gold prices are currently not bearish.

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