PRECIOUS-Gold holds in tight range as investors focus on U.S. inflation
· Gold prices held steady in a tight range on Tuesday as investors turned their focus to U.S. inflation data, which could shed more light on the Federal Reserve’s timeline for policy tightening.
· Spot gold rose 0.1% to $1,808.24 per ounce by 0619 GMT, while U.S. gold futures were 0.2% higher at $1,809.10. The dollar index was largely flat against rivals.
· After the U.S. consumer price index (CPI) report due at 1230 GMT later in the day, attention will shift to Fed Chairman Jerome Powell’s testimony before Congress on Wednesday and Thursday for his response to the inflation data.
· While gold is viewed as an inflation hedge, interest rate hikes will dull its appeal as they translate into a higher opportunity cost of holding the non-yielding precious metal.
· The CPI data is going to frame the perception the market has regarding Powell’s testimony, said IG Market analyst Kyle Rodda.
· “I think the Fed is edging closer towards that desire to warm the market up to policy normalisation and if they continue along that path or accelerate along that path, that’s going to be a headwind for gold,” Rodda said.
· Gold prices have stabilised after marking their biggest monthly drop since November 2016 in June, as Powell said the Fed would not raise interest rates too quickly based only on the fear of coming inflation and would aim for a “broad and inclusive” recovery of the job market.
· A drop in benchmark 10-year Treasury yields last week to the lowest in nearly five months also helped gold.
· “Barring unexpected news, I expect gold to consolidate and trade in a range of $1,800/oz to $1,820/oz over the coming week,” said Michael Langford, director at corporate advisory AirGuide.
· Gold Price Forecast: XAU/USD to wait US CPI data and Powell’s testimony for a sustained move
Gold edged higher on Friday and posted a third straight week of gains amid weaker USD. This week, XAU/USD eyes US CPI/Powell’s testimony for a fresh directional impetus, FXStreet’s Haresh Menghani notes.
· Focus now shifts to the US CPI and Fed Chair Powell’s congressional testimony
“The market focus will remain on the latest US consumer inflation figures due on Tuesday. This, along with the Fed Chair Jerome Powell's semi-annual congressional testimony on Wednesday and Thursday, will play a key role in determining the next leg of a directional move for the XAU/USD.”
“Dips below the $1,800 mark might continue to find some support near the $1,795-93 horizontal support, which should act as a key pivotal point for intraday traders. A convincing break below might prompt some technical selling and accelerate the slide further towards the $1,780-78 support zone. Some follow-through selling below the $1,775 level will negate any near-term positive bias and turn the commodity vulnerable. The next relevant support is pegged near the $1,762-60 region, below which the XAU/USD could slide back to retest June monthly swing lows, around the $1,750 area.”
“The $1,815-18 region now seems to have emerged as immediate resistance. This is followed by the very important 200-day SMA, around the $1,828-29 zone. A sustained strength beyond will be seen as a fresh trigger for bullish traders and set the stage for an extension of the recent positive momentum witnessed over the past three weeks or so. The commodity might then aim to surpass an intermediate barrier around the $1,852-55 region and test the next major hurdle near the $1,870 level.”
· Elsewhere, silver rose 0.1% to $26.20 per ounce, palladium fell 0.5% to $2,841.09 and platinum was little changed at $1,118.51.
· Dr. Kavita Patel says the need for a Covid booster shot seems inevitable with variants on the rise
Former Obama administration official Dr. Kavita Patel told CNBC on Monday she expects a Covid vaccine booster will, eventually, be authorized by U.S. regulators due to new, more transmissible coronavirus variants.
· FDA to announce new warning on J&J Covid vaccine related to a rare autoimmune disorder, report says
· WHO warns against mixing and matching COVID vaccines
The World Health Organization's chief scientist on Monday advised against people mixing and matching COVID-19 vaccines from different manufacturers, calling it a "dangerous trend" since there was little data available about the health impact.
"It's a little bit of a dangerous trend here. We are in a data-free, evidence-free zone as far as mix and match," Soumya Swaminathan told an online briefing.
"It will be a chaotic situation in countries if citizens start deciding when and who will be taking a second, a third and a fourth dose."
· China central bank says macro policy will depend on domestic conditions
· Japan warns of crisis over Taiwan, growing risks from U.S.-China rivalry
Growing military tensions around Taiwan as well as economic and technological rivalry between China and the United States threaten peace and stability in East Asia as the regional power balance shifts in Beijing's favour, Japan said in its annual defence white paper.
· The world must start preparing for the next pandemic, Singapore’s senior minister says
The next global pandemic could happen at any time and the world must start preparing for it now, said Singapore’s Senior Minister Tharman Shanmugaratnam.
· Singapore is launching a $50 million program to advance research on AI and cybersecurity
· S.Korea COVID-19 vaccine rollout grinds to halt as new cases spike
South Korea's rollout of COVID-19 vaccinations to people aged 55-59 has stuttered to a week-long halt after a spike in new cases sparked a rush for shots, booking up available supplies and crashing the official government reservation website.
The halt in vaccination appointments for people in the upper 50s age bracket came late on Monday, the first day that inoculation bookings were opened to under-60s. It came as daily infections, featuring the highly contagious Delta variant, came in at 1,150, a seventh straight day of more than 1,000 cases - the country's worst coronavirus outbreak so far.
· Bank of England keeping "very close eye" on housing market - Cunliffe
· European efforts to assess Russia’s Sputnik V vaccine stymied by data gaps
· More than 900,000 people in France rush for COVID vaccine as tougher measures near
· Sydney’s Covid cases ease slightly but lockdown extension still possible
· Israel changes strategy as Delta variant hits
Reference: Reuters, CNBC, FXStreet
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