2023-05-19 12:50:00
Books – Islam Saeed
Friday, May 19, 2023 03:50 PM
to stop gold On the decline after three consecutive sessions of losses, after it approached the important support level at 1950 dollars an ounce, this comes as the markets await the speech of US Federal Reserve Governor Jerome Powell today in an attempt to know the next step for US monetary policy.
and elevation gold prices Instant, today, Friday, by 0.4%, to trade – at the time of writing the report – at the level of $ 1964 an ounce. This comes after a significant decline yesterday by 1.2%, in which gold lost $ 24 of its value and pushed it to record its lowest level in 6 weeks at $ 1951 an ounce.
Although gold stopped rising today, it is on its way to recording a weekly decline of 2%, which is the second consecutive decline since recording the highest historical level of gold at $2080 an ounce.
Spot gold prices fell by more than $120 since it recorded its highest historical level at the beginning of this month, turning gold’s performance during the month of May until this moment into a negative performance.
Gold prices stopped falling today as a result of some oversold on gold, in addition to the collision with an important support level at $1950 an ounce, which reversed gold prices slightly upward, but the negative pressure remains predominant on the precious metal before the expected speech by Federal President Jerome Powell. today.
Concerns about the US debt crisis have diminished recently after the US President met with the Speaker of the US House of Representatives and came out with positive statements about their approaching an agreement, as US President Joe Biden and House Speaker Kevin McCarthy hope to finalize an agreement on the debt ceiling after Biden returns from the G7 meeting. in Japan on Sunday.
The end of the US debt crisis, gold markets lose important support, which helped gold in the recent period to stabilize above the psychological level of $2000 an ounce, which helped the significant decline in gold prices that we witnessed during the recent period.
The yield on 10-year US bonds rose yesterday by 2.5%, hitting a 9-week high of 3.659%, and the yield on two-year bonds rose by 2.6%, hitting a 4-week high of 4.281%.
Gold was subjected to great pressure from the statements of the US Federal Reserve members, which are in favor of the continuation of the strict policy by the Federal Bank, and the need to continue raising interest rates in light of the continued inflation at levels far from the target of the bank.
Fed member James Bullard, the Fed has explicitly called for higher interest rates as an insurance against inflation, and indicated that a 25 basis point rate hike at its next meeting in June might be appropriate.
Comments from Fed members this week have caused interest rate expectations to shift, with Fed funds futures markets currently pricing in a 33% chance that the Fed will raise rates by 25 basis points at its next meeting, up from just 10% last week. .
This change comes in light of the dissipation of fears about the banking crisis in the current period in the markets, in addition to the economic data issued by the United States, which indicates the economy’s tendency to moderate recession, amid other opinions indicating that the economy may survive the economic recession this year.
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