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July 13 – The latest epidemic report released by the Ministry of Health of the Democratic Republic of Congo on July 12 shows that the area affected by the current Ebola outbreak has increased to five provinces, with a total of 1,873 confirmed cases and 672 deaths. Chowpo and Haut-Uele provinces are listed as affected provinces for the first time. The report states that cases in both provinces are linked to the Nyania region of Ituri province. Previously, the Ebola outbreak affected Ituri, North Kivu, and South Kivu provinces. According to the report, 763 patients are currently in isolation or hospitalized, and 306 cases have recovered. The report also shows that South Kivu province has not reported any new confirmed cases since May 26, and as of July 7, it has reported no new confirmed cases for 42 consecutive days, twice the longest incubation period of the Ebola virus.On Monday, July 13, the Hang Seng Index opened down 17.47 points, or 0.07%, at 24,157.65; the Hang Seng Tech Index opened down 1.98 points, or 0.04%, at 4,719.68; the H-share Index opened up 3.07 points, or 0.04%, at 8,042.26; and the Red Chip Index opened up 14.61 points, or 0.38%, at 3,865.65.On July 13th, Barclays stated that although oil prices have fallen significantly from their peak during the Iran conflict, its inflation forecasts have deteriorated. In a report to clients, the bank stated that the Federal Reserves policy path of keeping interest rates unchanged this year, rather than raising them, has narrowed considerably in recent months. However, the bank added that this remains its base case scenario. The oil price shocks have come and gone, but inflation has not, due to the current overall strength of the US economy; therefore, the decline in oil prices cannot relieve the Federal Reserve of its inflation concerns.On July 13th, Chen Weicong, Investment Strategist at Bank of East Asia Wealth Management, pointed out that factors such as increased AI investment by technology companies and rising energy and memory production costs have led to a weaker-than-expected recovery in the earnings of heavyweight tech and consumer stocks. Therefore, he lowered his earnings forecast for the Hang Seng Index this year and reduced his target for the Hang Seng Index from 29,000 points to 27,100 points. He reiterated that the current forward P/E ratio for Hong Kong stocks is only 10 times, slightly lower than the average of about 10.5 times over the past 10 years, indicating gradually emerging valuation attractiveness. He believes the recent market downturn presents a buying opportunity and expects a phased rebound in the market in the second half of the year, but this rebound is unlikely to last long. If the July Politburo meeting releases more pro-growth policies, it could become a potential catalyst for the rebound.Futures Commentary by Everbright Futures: The escalating tensions in the Strait of Hormuz over the weekend put pressure on London spot gold in early trading on Monday. Looking back at last week, gold prices both domestically and internationally experienced increased volatility, continuing their weekly decline. Spot gold fell 1.51% for the week, while the Shanghai Gold Futures contract fell 1.48%. Geopolitically, a new round of conflict erupted between the US and Iran. With both sides intensifying their attacks, the risk of unrestricted navigation through the Strait of Hormuz has increased again. Rising oil prices and inflation expectations have contributed to short-term weakness in gold prices. 1. Macroeconomic Overview: Disagreements within the Federal Reserve regarding monetary policy communication methods are surfacing. Governor Waller stated that forward guidance remains a valuable policy tool, contrasting with Warshs stance. Federal Reserve Chairman Warsh will testify before the Senate Banking Committee on July 15th. This hearing will focus on the Feds semi-annual monetary policy report submitted to Congress, potentially providing some guidance on interest rates and the direction of monetary policy. 2. The precious metals market will face a double test with Warshs congressional debut and CPI data releases. On July 14th, the US June CPI will be released on the same day as Warshs House hearing, followed by the PPI data release on the 15th, after which Warsh will testify before the Senate. The resonance between inflation data and policy signals will influence precious metal price movements. With the US and Iran entering a second round of conflict, the market initially returned to trading based on rising inflation and interest rate expectations. However, judging from the weekly performance of oil and gold prices, the sustainability of this conflict is not optimistic. Furthermore, there were no further positive factors to drive a significant rebound in gold prices; the overall trend remains weak and corrective. This indicates that the current bottoming-out range for gold is not stable. With geopolitical factors and Fed policies repeatedly intertwined, there is significant divergence between bulls and bears, requiring continued caution.

Forecast for Silver Price: XAG/USD is rising quickly and is approaching the $20.00 mark

Alina Haynes

Sep 15, 2022 11:43

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Silver price recovers around the 50-day exponential moving average and advances towards a daily high of $19.69 on Wednesday after the US Labor Department reported that August PPI was in line with predictions of diminishing inflationary pressures on the producer side. Therefore, the XAG/USD is trading at $19.61, 1.86% higher than its initial price.

 

Before Wall Street opened, the Bureau of Labor Statistics (BLS) of the United States reported that the Producer Price Index (PPI) for August decreased by 0.1%, in line with expectations, while the year-over-year figure fell to 8.7%, less than the 9.8% reported in July. Meanwhile, the so-called core PPI, which excludes volatile goods, increased by 0.4% month-over-month and 7.3% year.

 

In the meantime, the US Dollar Index, a measure of the dollar's value against a basket of six currencies, ended Wednesday's session down 0.15 percent, at 109.648, weighed down by US Treasury yields, particularly the 10-year benchmark note rate, which remained unchanged throughout the day at approximately 3.404%.

 

The US Dollar Index reflects the aforementioned by declining by 0.09% and falling below the 110.000 barrier. Similarly, the US 10-year benchmark note rate exhibits signs of weariness, remaining flat at approximately 3.414%.

 

The fact that US 10-year TIPS yields, a proxy for actual yields, rose by only one basis point to 0.939% was a further factor supporting the white metal price.

 

On Thursday, the US economic calendar will contain jobless claims, retail sales, and the New York and Philadelphia Fed Manufacturing Indices, which will serve as a precursor to the ISM report in October.

 

The daily XAG/USD chart depicts the white metal as neutral to bearishly biased. Nonetheless, if silver buyers recapture the $20,000 threshold, this might pave the way for a test of a four-month-old downslope trendline near $20.20 prior to reaching the 100-day EMA at $20.39. A breach of the latter will reveal the cycle high from August 15 at $20.87, ahead of the psychological milestone of $21.00.


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