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The yield on 30-year UK government bonds fell 5.9 basis points to 5.685%.Spains composite PMI for April was 48.7, compared to 52.4 in the previous month.French Foreign Minister: Putins troops withdrew 120 square kilometers from Ukraine in April, the first time in three years. The Russian economy is in crisis. The Kremlin should have opened its eyes to its failures long ago and ended this senseless and costly conflict.On Wednesday, May 6th, the German DAX 30 index opened 278.73 points higher, or 1.14%, at 24,671.00; the UK FTSE 100 index opened 119.56 points higher, or 1.17%, at 10,338.67; the French CAC 40 index opened 69.34 points higher, or 0.86%, at 8,131.65; the Euro Stoxx 50 index opened 51.33 points higher, or 0.87%, at 5,920.96; the Spanish IBEX 35 index opened 179.31 points higher, or 1.01%, at 17,847.01; and the Italian FTSE MIB index opened 466.00 points higher, or 0.96%, at 49,023.50.On May 6th, it was learned from the Guangzhou Municipal Housing and Urban-Rural Development Bureau that the Guangzhou real estate market saw a significant rebound in activity during the May Day holiday, with both the primary and secondary housing markets showing positive performance, indicating a clear recovery trend. Data shows that from May 1st to 5th, the Guangzhou primary housing market experienced a significant increase in activity, with an average daily visitor count of 8,692 groups, a year-on-year increase of 30.8%, and an average daily purchase volume of 634 units, a year-on-year increase of 50.1%. The secondary housing market maintained steady growth. The average daily number of viewings and purchases during the holiday increased by 15.6% and 5.2% respectively compared to April, with purchases increasing by 63.4% year-on-year, while the number of newly listed secondary homes declined. An official from the Guangzhou Municipal Housing and Urban-Rural Development Bureau stated that on April 30th, Guangzhou released implementation opinions on further promoting the stable and healthy development of the real estate market, proposing multiple measures from aspects such as optimizing the use of housing provident funds and streamlining the replacement chain. The policy benefits have been quickly transmitted, and the market response has been significant.

Forecast for Gold Price: XAU/USD licks US inflation-related wounds near $1,700

Alina Haynes

Sep 14, 2022 11:39

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Gold price (XAU/USD) is under pressure near $1,700 as bears take a pause following the largest daily decline in two weeks due to US inflation. However, it should be noted that a lack of important data/events appeared to limit bullion's quick movements throughout Wednesday's Asian session.

 

Tuesday's US inflation statistics rekindled fears about the Federal Reserve's fast rate hike and exacerbated recession concerns. Also acting as factors for a decline in the XAU/USD are geopolitical concerns over China and Russia.

 

In August, the US Consumer Price Index (CPI) surpassed market expectations by increasing 8.3% year-over-year (YOY), compared to 8.8% previously. However, the monthly data increased to 0.1%, exceeding the -0.1% anticipated and 0.0% previous estimates. The core CPI, which excludes food and energy, likewise exceeded the 6.1% consensus and 5.9% prior to printing at 6.3% for the month in question.

 

Following the release of US inflation statistics, wagers on the Fed's next move became further aggressive, with a 75 basis point (bps) raise next week appearing nearly probable. There is a 25% possibility that the US Federal Reserve (Fed) will announce a complete 1% hike in the benchmark Fed rate at its meeting on September 21.

 

It should be mentioned that the yield inversion expanded after US inflation data and fueled recession concerns, which in turn weighed on the XAU/USD values due to the pair's reputation as a risk-barometer. However, following the release of the data, rates on 10-year US Treasury notes rose to 3.412% and those on 2-year bonds rose to 3.76%, from roughly 3.411% and 3.745%, respectively. In addition, the US stock market experienced its largest daily decline in over two years following the announcement of the US CPI, which thrilled metal bearish.

 

In addition to the rush toward deeper ties with China, US Vice President Joe Biden's efforts to raise China's troubles contribute to Sino-American tensions. In addition, worries that Russia will retaliate harshly after retreating from certain regions of Ukraine weighed on market mood and the price of gold.

 

A light schedule ahead of the US Producer Price Index (PPI) may keep XAU/USD on the precarious floor, but bears are likely to maintain control until Thursday's US Retail Sales for the month of August and Friday's preliminary reading of the Michigan Consumer Sentiment Index for September.

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