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·         Gold slipped on Tuesday to its lowest since mid-April as the dollar strengthened in the run-up to this week’s U.S. jobs report, which is expected to come in strong and could cement the Federal Reserve’s recent hawkish stance.

 

·         Spot gold fell 0.93% to $1,761.66 per ounce by 01:39 pm EDT after touching $1,749.20, its lowest since April 15. U.S. gold futures settled down 1% at $1,763.60.

 

·         In addition to a stronger dollar, some investors are likely anticipating better-than-expected jobs data, said Bob Haberkorn, senior market strategist at RJO Futures.

 

·         “The calls for interest rates to trend higher are going to be much louder from the Fed if we do get a better-than-expected jobs number,” weighing on gold, Haberkorn said.

 

·         The U.S. Labor Department’s nonfarm payrolls data on Friday is expected to show a gain of 690,000 jobs this month, compared with 559,000 in May, according to a Reuters poll.

 

·         The data is due after comments from Richmond Fed President Thomas Barkin, who suggested the Fed had made “substantial further progress” in its inflation goal in order to begin tapering asset purchases.

 

·         Growing signs that point to a sooner-than-expected U.S. interest rate hike and the preceding tapering should heap more downward pressure on gold, potentially bringing it down to $1,730, Han Tan, chief market analyst at Exinity Group said.

 

·         The dollar index rose 0.2%, making gold more expensive for other currency holders.

 

·         But, a broader data disappointment trend could eventually support gold as the market reflects on continued economic risks at a time when markets have priced a first rate hike from the Fed in December 2022, TD Securities said in a note.

 

·         In other metals, silver was down 1.3% at $25.75 per ounce, after touching its lowest since April 15 at $25.51. Platinum shed 1.8% to $1,070.30, and palladium slipped 0.5% to $2,673.72.

 

 

·         Fed's Waller: 2022 rate hike possible, wants MBS taper first

 

A “very optimistic” Federal Reserve Governor Christopher Waller on Tuesday said the U.S. central bank may need to start dialing down its massive asset purchase program as soon as this year to allow the option of raising interest rates by late next year.

 

“The unemployment rate would have to drop fairly substantially, or inflation would have to really continue at a very high rate, before we would take seriously a rate hike in 2022, but I’m not ruling it out,” Waller told Bloomberg TV in his first public comments since the Fed met earlier this month.

 

Waller declined to say whether he is one of the seven Fed policymakers who believe a 2022 liftoff from current near-zero rates will be appropriate, or among the 11 others who see 2023 or even later as more likely.

 

But with the crisis phase of the pandemic over, Waller said, “we are now in a different phase of economic policy, and so it’s appropriate to start thinking about pulling back on some of the stimulus,” beginning with how and when to start tapering the Fed’s monthly purchases of $40 billion in mortgage-backed securities and $80 billion in Treasuries.

 

Waller said he would be “all in favor” of phasing out MBS purchases first.

 

 

·         In Wisconsin, Biden says infrastructure plan would create millions of jobs

U.S. President Joe Biden promoted his $1.2 trillion infrastructure package as a "generational investment" on Tuesday as he sought to pump up support for a plan that is in need of wide support in Congress to become reality.

Biden visited a public transit facility in La Crosse, a city in western Wisconsin, highlighting the plan's investment of some $48.5 billion in public transit to reduce commute times and help reduce emissions, while boosting economic growth and wages.

In a speech, he spoke about local gains from the deal, including funds for electric buses, replacement of some 80,000 lead water lines in Milwaukee and better access to high-speed internet.

The bipartisan package also includes $109 billion in funding for roads, bridges and other major projects, including the 1,000 bridges rated structurally deficient in Wisconsin.

 

 

·         The U.S. is falling further behind China and Europe in electric-vehicle production

 

·         The world’s biggest companies are increasingly worried about water scarcity

 

Major companies from across a range of sectors are increasingly concerned about the cost and availability of the world’s ultimate renewable resource: water.

 

The availability and relatively low cost of water does not tend to capture much attention until it effectively runs out. Yet, with the climate crisis seen as a “risk multiplier” to water scarcity, analysts warn that even companies with relatively limited financial exposure to water risk should brace for disruption.

 

It comes at a time when water prices are rising around the world. The average price of water increased by 60% in the 30 largest U.S. cities between 2010 and 2019, according to data compiled by Barclays, while California Water Futures have regularly jumped as much as 300% in recent years.

 

In a research note published June 14, analysts at Barclays identified water scarcity as “the most important environmental concern” for the global consumer staples sector, which includes everything from food and beverages to agriculture and tobacco.

 

 

·         S&P cuts growth forecasts for Asia’s top economies including India

S&P Global has cut growth forecasts for some top Asian economies including India due to a slow-than-expected rollout of vaccines.

S&P Global cut its growth forecasts for some of Asia's top economies including India, the Philippines and Malaysia on Monday, offsetting upgrades to China and South Africa and much of Latin America.

 

·         India’s new loan guarantees may have limited impact on the Covid-hit economy

India has rolled out a slew of measures amounting to 6.3 trillion rupees ($84.9 billion) aimed at boosting the Covid-struck economy — but economists are skeptical that it will have a major impact on short-term growth.

The impact of those policies — that amount to about 2.8% of GDP — on the country’s fiscal deficit target is expected to be comparatively small.

Economists pointed out that the bulk of the support comes in the form of loan guarantees — instead of direct stimulus such as checks that are paid directly to households. Besides, some of the measures were previously announced and have already been factored into calculations.

 

·         South Korea aims for a post-Covid comeback, hopes to achieve herd immunity

The government intends to boost consumption and further stimulate the economy in the second half of this year — and policies will be in place to achieve that goal, said South Korea’s Deputy Prime Minister Hong Nam-ki.

He claimed that South Korea is aiming for herd immunity by November.

 

·         New Zealand to partially restart ‘travel bubble’ with Australia

 

·         Biden confirms he won't allow Iran to receive nuclear weapons