Gold prices are volatile and continue to lack major risk drivers and are currently fluctuating between $1846 and $1868. Before the start of the Asian session, volatility in recent trading had slowed down. The dollar index rose, but mainly due to the weakness of the euro. Lower real yields on US Treasuries are usually good for gold, but lower inflation offsets its upward posture. The novel coronavirus variant prompted the delay of the vaccine, which had an impact on the European market, while the US stock market rose mostly. Looking ahead, gold investors are waiting for new risk indicators, and the Fed is expected to reiterate its position on loose monetary policy.
As of 08:20 Hong Kong time before the press deadline, the price of gold fell 0.12 per cent to US $1854.
Fundamental analysis: it is still difficult to solve the global pandemic by delaying the distribution of vaccine by mutant virus.
Novel coronavirus vaccine is facing slow distribution and emerging manufacturing problems. Pfizer of the United States has proposed to the European Union that vaccine distribution will be delayed due to the restructuring of its manufacturing pharmaceutical plant in Belgium. AstraZeneca made a similar announcement last week when the group reached a major agreement with UK pharmaceutical companies and waited for approval. Earlier, British Prime Minister Johnson warned that there was evidence that British variants of the virus could be more deadly. The data show that the death rate may increase by 30% in some age groups. Fauci, director of the National Institute of Allergy and Infectious Diseases in the United States, also expressed this concern, saying that the new variant virus should be taken very seriously, and the mutated virus found in the UK is more virulent. The vaccine version needs to be upgraded to deal with the variant novel coronavirus, and he also claimed to be worried about delaying the second dose of novel coronavirus vaccine, the risk is that the existing vaccine may not be able to fight the future variant novel coronavirus.
As New Zealand announced a confirmed case of the variant virus, people familiar with the matter confirmed to the US CNBC that South African citizens who recently entered the United States had been diagnosed and carried the new variant strain in their bodies. In the face of the slow pace of the epidemic, US President Joe Biden plans to restore travel bans in South Africa, Britain and Brazil, all of which have developed new variants, and it is worth noting that the former US president has previously lifted these restrictions. Biden's travel ban is also likely to apply to Ireland and most of Europe.
Anne Schutter (Anne Schuchat), deputy director of the Centers for Disease Control and Prevention, told reporters that the agency has taken a series of measures to protect the American people and reduce the spread of the variant virus, adding that they are increasing the risk of a pandemic. Ahead of Biden's inauguration, incoming White House Press Secretary Jepsaki (Jen Psaki) criticized Trump's move to lift international travel restrictions, despite more contagious variants around the world. "We plan to strengthen public health measures around international travel to further reduce the spread of the novel coronavirus epidemic," he wrote on Twitter. "
A spokesman for the US Centers for Disease Control and Prevention said in a statement: "as variants of the SARS-CoV-2 virus continue to appear in countries around the world, there is growing evidence that some of these variants are more transmissible and their effects on health and vaccines are unknown. Testing before and after the trip is essential to slow down the introduction and spread of novel coronavirus's epidemic and emerging variants. "
Concerns about delays in vaccine launches and renewed blockade restrictions in various countries put pressure on European markets, with European stock markets and the euro falling, while European bonds rose. But it did not spread much to the US market, and US stocks closed mostly higher, although Treasuries did rebound sharply. Gold investors are more likely to get information from the United States than the European market, so the lack of risk means that the price of gold has also been greatly suppressed.
Looking ahead, the US market is waiting for major risk events later this week, the FOMC meeting and the US fourth quarter GDP preliminary data are worthy of investors' attention, and the Fed is expected to reiterate its ultra-loose monetary policy position. Given the Fed's preferred indicator of inflation, the core PCE data for December should also be a cause for concern. Inflation is not expected to pick up at the end of the first quarter, but will rise based on the base effect.
Technical analysis:
The warning light for gold prices has flashed again as it has fallen below its 50-day moving average, which is now about $1863.40, which is the bulls' last hope. If gold fails to break through its 50-day moving average, we may see gold approaching its initial level of $1800.
