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The Hang Seng Tech Index surged in the afternoon, rising over 1%, with Lenovo Group (00992.HK) leading the gains among constituent stocks, rising over 16%.August 13th - According to foreign media reports, Japanese Prime Minister Sanae Takaichi supports a near-term interest rate hike by the Bank of Japan, with the next move likely in September or October. The Bank of Japans concerns about the weak yen pushing up prices, coupled with the governments desire to enhance the effectiveness of recent joint US-Japan foreign exchange market intervention, have led to a convergence in their stance on the necessity of a near-term rate hike. The Prime Ministers Office believes that specific monetary policy measures, including interest rate hikes, should be decided by the Bank of Japan, but both sides should cooperate closely to achieve the 2% inflation target with "stability."Market news: The Bank of Japan may raise interest rates in September or October.Market news: Japanese Prime Minister Sanae Takaichi reportedly supports the Bank of Japan raising interest rates more quickly.On August 13, the Bank of Korea (BOK) purchased gold-related assets for the first time in 13 years to hedge against geopolitical and economic uncertainties. According to a filing with the U.S. Securities and Exchange Commission, the BOK held 679,765 shares of SPDR Gold Shares, worth approximately $250 million, at the end of the second quarter. The filing shows that three months prior, the bank did not hold any shares in the worlds largest physical gold-backed ETF. The BOK stated that this investment marks its first purchase of gold-linked assets since 2013. This purchase will not increase the banks official gold reserves, as gold ETFs are classified as securities and are part of its foreign exchange reserves. Choi Kyuho, an economist at Hanwha Investment & Securities, said, "The BOKs current gold allocation is quite low. From a global standards perspective, the BOK still has room to purchase more gold. I believe they will gradually increase their gold holdings."

Gold Price Prediction: XAU / USD will continue to fluctuate above $1,900 despite a decline in US Inflation

Daniel Rogers

Mar 15, 2023 11:43

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Gold price (XAU / USD) is not in danger despite U.S. inflation figures meeting expectations. Since Monday, the precious metal has been fluctuating continuously between $1,895 and $1,913. The release of the US Consumer Price Index (CPI) failed to produce a significant reaction in the Gold price; however, the upside bias appears to be solidified as wagers on lesser rate increases from the Federal Reserve (Fed) have increased.

 

The US Dollar Index (DXY) is protecting the critical support at 103.50, but it appears vulnerable to further losses as investors' risk appetite has dramatically increased. As market participants purchased S&P500 futures in response to higher odds of a smaller rate hike from Fed chair Jerome Powell, a likely recession in the US economy was postponed, signaling an uptick in optimism.

 

Contrary to the risk-on sentiment, demand for US Treasury bonds remained weak, causing 10-year US Treasury yields to rise above 3.68 percent.

 

The headline As anticipated, the US CPI increased by 0.4% on a monthly basis, and the annual figure decreased from 6.4% to 6.0%. In addition, the core CPI, which excludes crude and food prices, decreased to 5.5% from 5.6% previously. The Fed appears to be pleased with the persistence of a declining trend in US inflation.

 

In the future, investors will closely monitor the US Retail Sales (Feb) data. Monthly Retail Sales data is anticipated to decline by 0.3% compared to the previous release of a 3.0% increase. This indicates that the consumer spending rebound is over and the Fed is on course to achieve its inflation target of 2%.

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