shine trader live reports:
On Tuesday (November 9), spot gold continued to refresh its highest level since September 7 at US$1827.25 per ounce, and the US dollar index was further under pressure. US inflation data will be the next indicator of market trends. The Fed’s decision-makers have also launched a new debate around the policy direction.
At 19:39 Beijing time, spot gold rose 0.11% to US$1826.11 per ounce; the main COMEX gold contract fell 0.03% to US$1827.5 per ounce; the U.S. dollar index fell 0.06% to 93.992.
The results of a survey released by the Federal Reserve Bank of New York on Monday showed that short-term inflation expectations in October have increased, and consumers’ expectations of how much money they will make and spend in the next year have risen to their highest levels in eight years. This report provides more evidence that the imbalance caused by the epidemic may lead to inflationary pressures and wage growth. Fed policymakers said last week that they basically expect these pressures to subside on their own as the imbalance between supply and demand is resolved, but they are watching the data closely to look for signs that the pressure may continue.
Sugandha Sachdeva, vice president of commodities and currency research at Religare Broking, said: “Wednesday’s (inflation) data may be beneficial to gold, or will show that inflation is rising at the fastest rate since 1990.” said Nicholas Frappell, global general manager of ABC Bullion. Gold faces strong resistance at around 1835 US dollars. The trend of gold in the next few trading days is mainly determined by the US Consumer Price Index (CPI) report on Wednesday (November 10).
The Fed’s decision-makers start a new debate
Fed officials on Monday (November 8) turned their focus to the debate on monetary policy. As the Fed slows down its asset purchases and prepares for an interest rate hike as soon as next year, this debate will heat up in the coming months. The core of the debate will be to assess how many more jobs the economy can add, and how long it can tolerate high inflation when inflation has exceeded a comfortable level.
The “dot plot” of interest rates shows that the Fed officials’ interest rate expectations are moving in the direction of raising interest rates next year, but the number of policymakers who are expected to raise interest rates for the first time in 2022 is equal to the number of policymakers who are expected to start raising interest rates in 2023; most of the decisions are made. The author stated that interest rates will be steadily increased in 2023 and 2024.