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U.S. EIA natural gas inventories for the week ending July 24 were 28 billion cubic feet, compared to an expected 35 billion cubic feet and a previous reading of 32 billion cubic feet.On July 30, the Thailand Futures Exchange issued an announcement stating that due to a 2.50% drop in the USD/JPY futures trading price compared to the most recent settlement price, and in accordance with the guidelines for suspending trading of derivatives due to triggering daily price fluctuation limits, the Thailand Futures Exchange decided to temporarily suspend futures trading of this currency pair from 21:04:41 local time, and resume formal trading at 21:06:41.On July 30th, after the Bank of England kept interest rates unchanged and stated that domestic inflationary pressures were easing, UK short-term government bonds saw their biggest single-day gain in over a month. The yield on the most sensitive monetary policy gilt fell 11 basis points to 4.34%, the largest single-day drop since June 12th. Bank of England Governor Bailey stated at a press conference that he did not want people to "leave the meeting with the impression that the committee is gradually moving towards raising interest rates," after which UK government bonds further extended their gains. Influenced by the Bank of Englands dovish stance, the money market expects the Bank of England to raise interest rates by a cumulative total of about 32 basis points by the end of this year, lower than the 38 basis points before the decision was announced. The markets probability of a rate hike at the September meeting has also fallen from nearly 60% to less than 40%. James Lynch, portfolio manager at Aberdeen Asset Management, said, "The threshold for a Bank of England rate hike is very high." He expects the Bank of England to keep interest rates unchanged for the remainder of the year. He stated that Bailey was "more definitive than I expected."Ukrainian President Volodymyr Zelenskyy signed a decree appointing Oleksiy Sobolev as Deputy Chief of Staff of the Presidential Office of Ukraine.The U.S. EIA natural gas storage figures for the week ending July 24 will be released in ten minutes.

Forecast for Gold Price: XAU/USD consolidates above $2,000 as investors await initial US S&P PMI data

Daniel Rogers

Apr 21, 2023 13:52

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During the Asian session, the price of gold (XAU / USD) is oscillating above the psychological resistance of $2,000.00. After a gradual increase, the price of gold has leveled off near $2,005.00 as investors await the release of preliminary S&P PMI data for the United States.

 

S&P500 futures have added some gains during the Asian session following three consecutive declines. As a result of Elon Musk's price-cutting frenzy, Tesla's revenue projections were gloomy, which dampened market sentiment. Near 101.77, the US Dollar Index (DXY) has extended its correction. The USD Index has been consolidating in a range between 100.90 and 102.03 for the past several trading sessions. Therefore, a move that exceeds the previously specified limit will be considered decisive.

 

The subdued USD index weighs on US Treasury yields as well. The demand for U.S. government bonds has increased as weekly unemployment claims have increased. The number of individuals claiming unemployment benefits rose to 245K, exceeding the consensus estimate of 240K. This indicated a softening in the labor market and bolstered expectations that the Federal Reserve (Fed) will not raise interest rates after the monetary policy meeting in May.

 

In the future, the publication of the preliminary US S&P PMI data will determine the impact of the Fed's rate hikes on the scope of economic activity. According to projections, the Manufacturing PMI and Services PMI will decline to 49.0 and 51.5, respectively. A preliminary PMI reading that is weaker than anticipated could impact heavily on the U.S. dollar.

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