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On April 6th, Sky Links Capital CEO Daniel Takieddine stated that golds upside potential may be limited as market expectations for a Federal Reserve rate cut weaken. Strong US labor market data supported US Treasury yields, putting pressure on gold. Continued diplomatic efforts supported market expectations of a potential resolution to the Middle East conflict, further increasing uncertainty surrounding the gold outlook. However, geopolitical risks outside the Middle East and continued gold purchases by central banks are still providing support for gold prices. He pointed out that golds short-term movement will depend on upcoming US economic data, Federal Reserve policy signals, and developments in the geopolitical situation.Goldman Sachs upgraded Netflix (NFLX.O) from Neutral to Buy, raising its price target from $100.00 to $120.00.On April 6th, a signing ceremony for the Hushi Electronics AI chip-supporting high-end printed circuit board (PCB) project was held in Kunshan. The project represents a total investment of 10.1 billion yuan and aims to establish a world-leading high-end PCB production base in Kunshan. Upon completion, the project is expected to generate approximately 15 billion yuan more in annual output value compared to 2025.On April 6, according to the Islamic Republic News Agency (IRNA), Iranian Foreign Ministry spokesman Esmail Bagheei stated that Tehran has finalized its demands in the context of recent proposals to end the war, but will only announce them at an appropriate time, emphasizing that Iran will not succumb to pressure. He stated, "A few days ago, they put forward some proposals through intermediaries, and this 15-point US plan was conveyed through Pakistan and some other friendly countries." He added, "Such proposals are extremely ambitious, unusual, and illogical." He stressed that Iran has its own framework. "Based on our own interests and our considerations, we have compiled and formulated a series of demands that we have put forward in the past and present." He also denied that contact with mediators meant weakness. "The fact that Iran has quickly and bravely expressed its position on a proposal should not be seen as a sign of surrendering to the enemy."A spokesperson for the Iranian Foreign Ministry said on the 6th that Iran is prepared to respond to the mediators and will provide timely updates if necessary.

Dollar Growth And Fed Hawkishness Are Pressuring Gold Prices

Aria Thomas

Feb 23, 2023 11:45

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Gold prices moved little on Thursday, but were down for the week as the dollar reached a six-week high on concerns of a hawkish Federal Reserve. Investors are now focusing on impending economic data for additional clues on the U.S. economy and monetary policy.


Later in the day, a revised estimate of U.S. GDP for the fourth quarter will be released, with any sustained evidence of resilience in the economy giving the Fed more room to continue raising interest rates. This notion was strengthened this week by readings on business activity that exceeded expectations.


Friday will also see the release of the Personal Consumption Expenditures price index for January, which is anticipated to confirm that inflation remained persistent throughout the month. In addition, the reading is likely to increase the Fed's calls for sharper interest rate increases in the future months.


At 19:07 E.T., spot gold was unchanged at $1,824.76 per ounce, while gold futures declined 0.1% to $1,832.85 per ounce (00:07 GMT). Both assets were down approximately 0.4% thus far this week.


Wednesday's publication of the minutes from the Federal Reserve's February meeting revealed that the majority of monetary policy committee members supported raising interest rates for an extended period of time this year. However, their proposals for a 25 basis point increase were deemed obsolete after data released after the Fed's meeting revealed that inflation remained much more persistent than anticipated.


Nonetheless, the dollar reached a six-week high versus a basket of currencies. The opportunity cost of holding non-yielding assets such as gold and other precious metals increases as interest rates rise.


This week will also bring inflation data from the Eurozone and Japan, which are expected to indicate that global price pressures remain elevated, likely resulting in tightening monetary conditions.


On Thursday, other precious metals were trading lower. Futures for silver fell 0.6% to $21.530 per ounce, while futures for platinum fell 0.1% to $950.80 per ounce.


High-grade copper futures were muted at $4.1790 per pound on Thursday, after falling 1.1% on Wednesday.


In spite of this, prices of the crimson metal have increased by nearly 2% so far this week, due to evidence of resilience in U.S. economic activity and optimism regarding China's recovery.


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