At the beginning of the Asian market on Tuesday (March 26), spot gold fluctuated within a narrow range and was currently trading around US$2,172.36 per ounce. The price of gold rose 0.3% on Monday, with spot gold closing at US$2,171.58 per ounce, driven by expectations of an interest rate cut by the Federal Reserve this year. , although traders are still awaiting inflation data this week to confirm the timing of a rate cut.
The U.S. will release weekly initial jobless claims on Thursday, and U.S. core personal consumption expenditures (PCE) price index data on Friday. Market reaction to the PCE data may not be seen until next week due to the Good Friday holiday. The market may tend to fluctuate this week.
Bart Melek, head of commodity strategy at TD Securities, said gold could easily hit 2,300 in the second quarter as free traders and exchange-traded fund (ETF) investors, who have not really participated in the rally so far, will enter the market once the rate cut is confirmed. USD or higher.
But stronger economic data could prompt gold to pull back, Melek said.
The dollar also gave back some of last week's gains, making gold cheaper for overseas buyers. However, the rebound in U.S. bond yields has made gold bulls wary.
Gold hit a record high last week after the Federal Reserve reiterated its view of three interest rate cuts in 2024. Traders currently see a 70% chance of a rate cut in June, compared with a 65% chance before the Fed's March policy meeting last week. Lower interest rates tend to make non-yielding gold more attractive. Federal Reserve officials are expected to speak one after another this week, and investors need to pay attention.
Federal Reserve policymakers said on Monday they remained confident that U.S. inflation, especially gains in housing prices, will ease, which they expect will help bring down the overall pace of price increases, but also acknowledged growing caution surrounding the debate.
"While housing services inflation remains quite high, the current low increase in new lease signings suggests that housing inflation will continue to decline," Fed Governor Cook said at an event at Harvard University.
Chicago Fed President Goolsby said in an interview that the stickiness of housing inflation still surprises him, but he also believes that this part of inflation will ease.
Goolsby noted that progress on the pullback in headline inflation has slowed this year after falling steadily through 2023. "The main piece of the puzzle is on housing," Goolsby said. Housing is a major component of the consumer spending basket and has been rising in recent times, Goolsby said. occupies a large proportion of the overall inflation data.
"We have to get housing inflation back closer to pre-pandemic levels," he said. "I do think market rents are pointing to a further pullback in housing inflation, but we haven't seen that in the headline data yet."
The geopolitical situation also provided some support to gold prices on Monday.
On Friday night, four men stormed into Crocus City Hall and opened fire on a crowd at a rock concert, the worst attack in Russia in 20 years. Bastrykin, chairman of Russia's Investigative Committee, told a meeting in the Kremlin that the death toll had risen to 139, with another 182 injured.
Russian President Vladimir Putin acknowledged on Monday that last week's deadly attack on a concert outside Moscow was the work of Islamist militants, but suggested it also worked to Ukraine's advantage and Kyiv may have played a role.
Putin made the remarks at a Kremlin meeting dedicated to discussing responses to the attack, as France joined the United States in saying intelligence suggested the Islamic State (IS) was responsible for the attack.
Four men of Tajik origin were remanded in custody on terrorism charges by Moscow's Basman District Court on suspicion of carrying out the attack. Three others, also ethnic Tajiks, were remanded in custody on suspicion of conspiracy.
The Islamic State claimed responsibility for the attack and released footage of the attack.
"We know that this crime was committed by radical Islamists who have been fighting for their ideology for centuries," Putin said in remarks posted on Telegram, without directly mentioning the Islamic State. It reiterated previous claims that the attackers were trying to flee to Ukraine and said there were "many issues" that needed to be examined.
On this trading day, we need to focus on the monthly rate of durable goods orders in the United States in February, pay attention to the Conference Board Consumer Confidence Index data in March, and pay attention to news related to the geopolitical situation.
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2024-03-26
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