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On September 18th, many consumers reported on social media that they couldnt buy lemonade at various Mixue Ice City stores. A source close to Mixue Ice City reported that some stores in certain regions have recently experienced fluctuations in raw material supply due to weather delays in the arrival of a batch of imported lemons. Furthermore, Sichuan and Chongqing lemons have entered their harvest season and require storage for optimal taste, leading to supply shortages in some areas. However, overall lemon reserves are sufficient. A large volume of imported lemons is about to arrive, and the stored lemons have been evaluated and tested to meet usage standards. They are being distributed to stores, and the lemon shortages will soon be resolved.According to futures data from September 18th, Japans commercial crude oil inventories increased by 196,072 kiloliters to 10,698,257 kiloliters in the week ending September 13th. Gasoline inventories increased by 46,361 kiloliters to 1,691,790 kiloliters. Kerosene inventories decreased by 5,766 kiloliters to 2,692,860 kiloliters. The average refinery operating rate in Japan was 84.0%, compared to 87.6% the previous week.Samsung Electronics: Hiring 60,000 employees over the next five years; positions will focus on chips, biotechnology and artificial intelligence.According to futures data on September 18, overnight shibor was 1.5140%, up 3.10 basis points; 7-day shibor was 1.5280%, up 0.90 basis points; 14-day shibor was 1.5810%, down 2.60 basis points; January shibor was 1.5440%, up 0.30 basis points; March shibor was 1.5560%, up 0.20 basis points.On September 18th, Nick Timiraos, the "Federal Reserve mouthpiece," stated: "When the Federal Reserve cut interest rates on Wednesday, it superficially looked like a routine monetary policy operation. The market reaction was relatively muted, and Chairman Jerome Powell largely avoided the heated disagreements sparked by the decision, despite it occurring against the backdrop of unprecedented political confrontation." The policy shift initiated by Powells rate cut on Wednesday may represent his last effort to demonstrate that an independent US central bank remains capable of guiding the economy in a complex environment, rather than surrendering its independence before officials more aligned with President Trumps priorities gain greater control. Powells term as chairman will end next spring. For the third time in his tenure, Powell attempted an extremely delicate maneuver: cutting interest rates not because a recession is imminent, but to prevent one.

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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