Spot gold held steady around 1752 in Asia on Thursday. Gold surged more than 1% on Wednesday as mild u.s. consumer price data dragged down the dollar and allayed fears that the fed was about to scale back its bond purchases, but the rise in the stock market limited the gold price's rise. Focus on July PPI and initial application data in the United States.
[the rate of increase in US consumer prices moderated in July] Us consumer price growth slowed in July, but the slowdown failed to fully eliminate the pressure of rising costs at a time when rising prices hit consumer confidence and fuelled policy debate. Data released by the labour department on Wednesday showed that the US consumer price index (CPI) rose 0.5 per cent in July from a month earlier, up 5.4 per cent from a year earlier. Core CPI, excluding food and energy costs, rose 0.3 per cent from a month earlier and 4.3 per cent from a year earlier. Companies with rising cost pressures are raising the prices of goods and services amid supply constraints and surging demand. Lingering challenges, including shortages of raw materials, transport bottlenecks and recruitment difficulties, are likely to continue to pose broader price upward pressure in the coming months. The median forecast by economists shows that the CPI is up 0.5% from a month earlier and 5.3% from a year earlier. After the release of the data, US Treasuries recovered their lost ground, the dollar extended its losses, and S & P 500 index futures hit intraday highs. [the dollar fell at a high] The dollar fell to a high on Wednesday after US data showed that the rise in consumer prices slowed in July, easing some of the pressure on the Fed to slow its monthly bond purchases. Earlier in the day, the dollar hit 93.19, its highest level since April 1, not far from its high of 93.43 so far in 2021, but was sold off after the US inflation data were released. Kathy Lien, managing director of BK Asset Management, said: "the CPI report is enough to bring some profit taking to the dollar, but in the final analysis, it does not change the Fed's position that they will still announce a scaling back of their asset purchases," which is likely to happen in the next six weeks. At the same time, investor confidence in Europe is weakening, with German investor confidence deteriorating for the third month in a row in August, as fears of a rise in novel coronavirus infection could stifle the recovery in Europe's largest economy, according to a survey. Jane Foley, an analyst at Rabobank, said, "while outbreaks are still evident around the world, investors must consider the possibility that the Fed's tapering stimulus news will come true. "the consequence could be a stronger dollar," she added, especially if the euro falls below its 2021 low. [Canadian expert: Canada has entered the fourth wave of the epidemic] According to news on the 12th, Peter Juni (Peter Juni), director of the novel coronavirus epidemic scientific team of the Ontario government of Canada, said on Aug. 11, "there is no doubt that we have entered the fourth wave of the epidemic." In the most recent week, the seven-day average of daily confirmed cases across Canada has been close to 1300, an increase of 60 per cent from the previous week's average. [Fed officials are generally partial to eagles in their speeches] The US economy is growing strongly and the labor market is rebounding, several Fed officials said on Wednesday, suggesting that the time for the Fed to start withdrawing support is approaching. George, chairman of the Kansas City Fed, said the criteria for cutting asset purchases may have been met with soaring inflation, a recovery in the labour market and expectations that strong demand will continue. I support ending asset purchases in this case. George said that through strong fiscal and monetary policy support, the economy has emerged from the crisis caused by the novel coronavirus pandemic and embarked on the path of recovery, indicating that it is time for the Fed to start withdrawing some of its support. Dallas Fed Chairman Kaplan said the Fed should announce a timetable for scaling back its bond purchases in September and start scaling back in October. Kaplan said he doesn't think the Fed's $120 billion-a-month asset purchase program will help the current economy, which is facing supply problems, not demand problems. He also said that although scaling back the plan might help reduce excessive risk-taking. "just like a doctor prescribing medicine to a patient who has experienced trauma, if you start to see side effects, you think the drug is not very effective," he said. I think the best way is to start phasing out the medication as soon as possible. " Richmond Fed Chairman Barkin says it may take a few more months for the job market to recover before the Fed can reduce economic support during the crisis. This adds a centrist voice to the public debate about how to scale back asset purchases. "We are approaching," he said. I don't know exactly when. When we are really close to this goal, I am very supportive of reducing the size of bond purchases and returning to the normal environment as soon as the economy permits. " Barkin said it is unclear whether millions of people will return to the job market this fall as schools reopen and plans such as extra unemployment insurance end, or whether the pandemic and the Delta variant, now a major source of infection, will change lives and career choices to the extent that labour remains scarce. [Dow and S & P 500 hit record highs, boosted by slowing inflation in the United States] The Dow Jones Industrial average and the S & P 500 closed at record highs on Wednesday as data showed that US inflation growth may have peaked, while growth-related sectors climbed after a large infrastructure bill was passed. "of course, the data show a further slowdown in inflation," said Steven Ricchiuto, chief US economist at Mizuho Securities. "this figure will put the Fed in a bit of a dilemma because they have come out to speak about curtailing bond purchases, tightening interest rates and taking precautions, but the inflation figures are not where they should be, but they certainly do not show that things are out of control." Investors have been keeping a close eye on inflationary pressures in recent months, fearing that rising prices could prompt the Fed to start scaling back its ultra-loose policy stance sooner than expected. The Dow rose 0.62%, the S & P 500 rose 0.25%, and the NASDAQ fell 0.16%. Focus on July PPI and initial application data in the United States. The July PPI is expected to be not much different from the previous value, which is similar to the July CPI situation, indicating that the US inflation data has slowed across the board and that there is a possibility of a pullback in the future. The number of initial requests is likely to continue to decline slightly until it returns to pre-epidemic levels. The strong performance of non-farmers in July shows that the labour market continues to make great strides, which will also be reflected in the number of first-time applicants. Overall, the downward pressure on gold prices has not abated, as the expectation that the Fed will scale back its bond purchases still exists, and bulls should not be long blindly and need to be watched carefully. Beijing time 8: 42, spot gold at US $1752.37 / oz.
