Last week, we asked the question: “Will US jobs report drag gold below $1900?”
Sure enough, that freakishly hot US nonfarm payrolls print translated into a surge for the US dollar, which dragged the precious metal lower.
At the time of writing, gold is experiencing some volatility ahead of the weekend, apparently resulting from knee-jerk reactions in USDJPY due to reports of the incoming Bank of Japan Governor being initially perceived as more hawkish than other leading candidates.
Spot prices are currently testing immediate support at its 50-day simple moving average, though the precious metal can’t yet make up its mind whether to end the week in positive or negative territory.
The incoming US inflation data due on Valentine’s Day is set to be the next major catalyst for gold.
If the CPI print comes in higher than the market-forecasted 6.2%, that could force the Fed to keep hiking benchmark rates past the expected 5.15% peak.
Fresh evidence that US inflation remains stubbornly elevated should prompt bullion to further unwind its year-to-date gains.
However, if January’s CPI registers substantially lower than the estimated 6.2%, signalling that the Fed’s 450bps in rate hikes in this cycle are having the intended effect of dampening inflation, that may offer further relief for gold and perhaps even push prices back above $1900.
Gold’s recent crawl back up closer to $2k is awaiting validation from the US PCE core deflator due later today. Further evidence of still-sticky US inflation, with another 4.7% print that matches January’s number, may force bullion bulls to wait a while longer before reclaiming the $2k handle.
31 March 12:24
Spot gold is once again easing away from the $2000 handle, after having twice this week briefly surfaced above that psychologically-important mark. From a technical perspective, gold appears to be clearing even more froth as its 14-day relative strength index pulls back once more from the 70 threshold which marks “overbought” conditions.
24 March 12:19
Gold has broken above the psychologically-important $2k for the first time since March 2022 (following Russia’s invasion of Ukraine)! And gold could stay supported this week, as major central banks hold their respective policy meetings amid the market tumult and banking crisis engulfing both sides of the Atlantic.
20 March 10:41
Spot gold has skyrocketed towards its biggest weekly gain since November as contagion fears permeated global financial markets this week. The Credit Suisse crisis exacerbated the risk-off sentiment stemming from Silicon Valley Bank’s collapse, prompting market participants to rush towards safe haven assets.
17 March 12:00
A lower-than-expected NFP headline figure today, which suggests that January’s blockbuster number was a fluke, is likely to restore spot gold back above $1850. However, a stronger-than-expected February NFP print which ramps up market fears for an even-more aggressive Fed may drag spot gold back closer to the $1800 mark.
10 March 12:34
There's a better website for you
A new exciting website with services that better suit your location has recently launched!
Sign up here to collect your 30% Welcome Bonus.