- XAU/USD is under pressure with the Fed’s hawk tone and liquidity crisis.
- Powell signals indicate that tariffs can withdraw inflation, cooling rate cutting bets and gold prices.
- Financial Times reports that risk protection funds have faced the largest margin calls since Covid and provides forced liquidation of assets.
Gold (XAU) Price extended its losses on Friday and after a speech by the Federal Reserve (FED) President Jerome Powell, the lowest level of the seven days, which showed that inflation could react due to tariffs, fell to $ 3.015 dollars. XAU/USD is traded at $ 3,029 with a decrease of 2.70%.
The financial markets continued due to the increase in the trade war between the United States and China. In addition, Powell said that feeds may have an impact on the US economy, including slower growth and higher inflation.
An article on the Financial Times (FT) revealed that risk protection funds have been shot by the most important margin calls since the Covid-19 after the day of liberation of Trump.
Standard Chartered Analyst Suki Cooper said, iz We tend to see gold as a liquid asset used to meet margin calls elsewhere, so it is not unusual to sell it after a risk event for gold, given the role it can play in a portfolio. ” He said.
In terms of data, the US economic document included a powerful job report, emphasizing that private companies hired more than 200,000 people in March. The unemployment rate rose to the tenth, but Bloomberg said, “It was often a rounding error.”
Money market traders were priced by 2025 until 2025 until 2025. Prime Minister Sunday terminal.
Source Prime Market Terminal
The fears of stagnation are the inversion of the US10s to 3 -month yield curve, and the second pays 25 BPS more than the US 10 -year return.
Next week, the US Economic Document FED speakes, the latest Federal Open Market Committee (FOMC) minutes and the release of inflation data on both the consumer and manufacturer.
Daily Digest Market Carriers: US Dollar Power Power Sided Gold Price Tanks
- The US reduces 10-year T-Note yield to 4.00%of three basis points. US 10 -year Treasury inflation -protected securities (tips), according to their yields, the US Real reduces Four BPS to 1.718%.
- The US dollar index (DXY), which follows the performance of a basket of six currencies of money, exerts pressure on more than 103.09 rally and bullion prices.
- He said that the Monetary policy was appropriate while waiting for clarity before considering the interest rate adjustments of Fed’s Powell. “Tariffs are likely to increase inflation in the coming neighborhoods; more permanent effects are possible.” He said.
- Powell added that although the economic appearance is extremely uncertain and the economy is in a good place, the downward risks have increased.
- March’s non -agricultural payrolls exceeded 135 thousand forecasts and increased by 228K and significantly exceeded the 151k of February. The US unemployment rate rose from 4.1% to 4.2%.
XAU/USD Technical View: Gold price falls below $ 3.050
As the sellers continue to reduce prices and draw attention to a $ 3,000 challenge, PUKLU during gold writing. The relative power index (RSI) may be the last sign that the gold is ready to retreat, despite the rise, it is about to pass under the neutral level.
If the Gold presses a closed daily $ 3,000 per day, the next support will be from $ 2,937 to the simple 50 -day simple moving average (SMA) and then $ 2,900. On the other hand, if XAU/USD rises, buyers need to take back $ 3,100 to regain control.
Golden FAQ
Since gold is widely used as a means of value and change, it has played an important role in human history. Currently, in addition to its brightness and jewelry, precious metal is widely seen as a safe asset, that is, it is considered a good investment in turbulent times. Gold is also seen as a fence against currencies against inflation and depreciation because it is not based on a particular exporter or government.
Central banks are the largest gold holders. In order to support currencies in turbulent times, central banks tend to diversify and purchase gold to increase the perceived power of the economy and currency. High gold reserves can be a source of trust for a country’s payment power. According to World Gold Council data, central banks added 1,136 tons of gold worth about 70 billion dollars to their reserves in 2022. This is the highest annual purchase since the registrations started. Central banks of developing economies such as China, India and Türkiye are rapidly increasing their gold reserves.
Gold has an inverse correlation with both large reserves and safe assets, US Dollar and US treasures. The dollar tends to rise in the depreciation and allows investors and central banks to diversify their presence in turbulent times. Gold is also contrary to risk assets. While a rally on the stock market tends to weaken the gold price, sales in the risk markets tend to support valuable metal.
The price can act due to a wide range of factors. Geopolitical instability or a deep fear of stagnation can rapidly increase the price of gold due to safe protected status. As an inefficient asset, gold tends to rise with lower interest rates, while the higher cost of money usually gives weight on the yellow metal. Nevertheless, most moves depend on how the US dollar (USD) behaves as priced as dollar (XAU/USD). A strong dollar tends to control the gold price, while a weaker dollar raises gold prices.
