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June 18th, John Velis, macro strategist for the Americas at Bank of New York Mellon, said that no interest rate changes are expected at the upcoming Federal Reserve meeting, but the new Summary of Economic Projections may affect the market. The dot plot will indicate that the rate cut in 2025 will be lower than previously expected. Given that the market expects nearly two rate cuts this year, a more hawkish dot plot may disrupt the market. The Federal Reserve has become increasingly cautious about cutting interest rates in 2025, noting that inflation remains the top priority for most members who have shared their ideas. Given the continued uncertainty in policy, the Federal Reserve is unlikely to soften its interest rate views. After June, there are only four Federal Reserve meetings left this year, and it seems increasingly unlikely that there will be time for aggressive easing during the year.Hong Kongs Hang Seng Index closed at 23,710.69 points on June 18 (Wednesday), down 269.61 points, or 1.12%. Hong Kongs Hang Seng Tech Index closed at 5,214.41 points on June 18 (Wednesday), down 77.44 points, or 1.46%. The CSI 300 Index closed at 8,594.19 points on June 18 (Wednesday), down 100.48 points, or 1.16%. The H-share Index closed at 4,091.13 points on June 18 (Wednesday), down 36.17 points, or 0.88%.June 18, ING Bank commodity strategists said that the biggest concern in the oil market is the closure of the Strait of Hormuz, which will affect the flow of oil in the Persian Gulf. Nearly one-third of the worlds seaborne oil trade passes through this choke point. Severe disruptions in oil circulation are enough to push oil prices up to $120 a barrel. They predict that in this case, OPECs spare capacity will not help ease market tensions, as most of the spare capacity is located in the Persian Gulf. In this case, governments may have to use their strategic oil reserves, although this is only a temporary solution.Ukrainian MP: The Ukrainian Parliament passed a law on Ukrainian multiple citizenship.JD Logistics (02618.HK): Launched its first international self-operated express delivery service in Saudi Arabia.

Gold Price Prediction: XAU/USD struggles above $2,000 as additional Fed rate increases appear inevitable

Daniel Rogers

Apr 17, 2023 13:44

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During the Asian session, the gold price (XAU / USD) appears vulnerable above the psychological resistance of $2,000.00. Following a four-day low of $1,992.50, the precious metal has exhibited a recovery trend. However, the recovery appears precarious as bullish wagers on the US Dollar Index (DXY) limit the upside.

 

As the probability of a consecutive 25 basis point (bp) rate hike from the Federal Reserve (Fed) is exceedingly high, the USD Index seeks to extend its recovery above the immediate resistance of 101.75. According to the CME Fedwatch instrument, the likelihood of a rate rise is nearly 80%.

 

In the meantime, S&P500 futures posted significant gains early on Monday, following a moderate decline on Friday. Quarterly earnings season is anticipated to keep US equities stock-specific. As a result of the precipitous drop in petroleum prices in March, manufacturing and oil-dependent businesses could experience a reasonable earnings rebound.

 

The demand for U.S. government bonds has decreased considerably in response to rising wagers on additional Fed policy restrictions. President of the Federal Reserve Bank of Atlanta Raphael Bostic stated that with one more quarter-point increase in interest rates, the Fed can conclude its tightening cycle with some assurance that inflation will gradually revert to its 2% objective.


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