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On August 10, EU High Representative for Foreign Affairs and Security Policy Kallas stated in a media interview that any agreement between the United States and Russia to end the conflict between Ukraine and Ukraine must include Ukraine and the European Union. Kallas stated that any agreement between the United States and Russia must include Ukraine and the European Union, as it concerns the security of Ukraine and all of Europe. Kallas also announced that an emergency meeting of EU foreign ministers will be held on August 11 to discuss next steps.Azerbaijan said its energy cooperation with Ukraine would not be interrupted by the Russian attack.On August 10th, the carry trade saw a resurgence among emerging market investors, fueled by bets that the Federal Reserve will begin cutting interest rates next month, weakening the dollar and boosting interest in high-yielding currencies. Asset managers from Neuberger Berma to Aberdeen Group are increasing their exposure to currencies such as Brazil, South Africa, and Egypt. They believe a weaker dollar and easing volatility create a fertile environment for this strategy, in which traders borrow lower-yielding currencies and buy higher-yielding ones. Earlier this year, these trades generated double-digit returns, but the momentum took a breather in July as the dollar rebounded. Recent weak US jobs data has reinforced expectations that policymakers will be forced to cut interest rates next month to avoid a recession, fueling a renewed surge in carry trades. Many institutions, from DoubleLine to UBS, have recently joined the bearish chorus on the dollar, stating that "the bearish narrative for the dollar has resurfaced." “The likelihood of a significant dollar rebound is very limited, while overall global growth remains solid,” said Urquieta, co-head of emerging market debt at Neuberger Berman. He prefers carry trades in South Africa, Turkey, Brazil, Colombia, Indonesia and South Korea.German Chancellor Merz: "Hope and assume" Zelensky will attend the Alaska talks.U.S. Vice President Vance: The United States will maintain dialogue with Ukraine and Zelensky.

Gold Price Prediction: After a chaotic gyration above $2,020, the XAU/USD pair stabilizes as investors watch the crucial US NFP report

Alina Haynes

Apr 06, 2023 11:49

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In the early Tokyo session, the Gold price (XAU / USD) is exhibiting lackluster performance above $2,020.00. Wednesday's publication of lackluster employment data in the United States caused a wild swing in the price of precious metals. Investors have transferred their focus to the publication of the US Nonfarm Payrolls (NFP) data, resulting in a sideways Gold price.

 

S&P500 continued its downward trend on Wednesday as a weaker Services PMI bolstered recessionary indicators in the U.S. economy, indicating bearish market sentiment. The US Dollar Index (DXY) rebounded strongly from its new monthly low of 101.40 but encountered resistance near 102.00. Despite the publication of unfavorable US Services PMI and labor market data, the USD Index received significant bids.

 

The US ISM Services PMI for March decreased to 51.2 from 54.5 and 55.1 in the previous release. As a result of the Federal Reserve's decision to raise interest rates, a decline in the Service sector is causing growing concern. (Fed). Additionally, households struggle to endure the burden of high inflation. The New Orders Index, which indicates future demand, fell sharply to 52,2 from 57,6 and the previous reading of 62.6. It is very encouraging that the US Services PMI range did not fall below 50, as this would have indicated a contraction.

 

Following the release of disappointing US Automatic Data Processing (ADP) Employment data, investors are eagerly anticipating the release of US NFP, which will shed more light on the state of the labor market. It is anticipated that the unemployment rate will remain unchanged at 3.6%. And Average Hourly Earnings would decline to 4.3% from 4.6% previously reported.


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