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Gold jumps after Fed’s Powell fails to signal taper timeline

 

·         Gold bounced over 1% on Friday after Federal Reserve Chair Jerome Powell stopped short of signaling when the U.S. central bank would start withdrawing its economic support and reiterated his view that current price spikes are transitory.

·         Spot gold rose 1.4% to $1,817.21 per ounce by 1:33 p.m. ET. U.S. gold futures settled up 0.9% at $1,819.50.

 

·         “They’re not going to raise rates anytime soon and taper talk won’t come back into play until next week’s jobs report. That cleared the path for gold, and as it broke above $1,800, it’s eying the next resistance level at around $1,820,” said Phillip Streible, chief market strategist at Blue Line Futures in Chicago.

 

·         In a virtual speech to the Jackson Hole economic conference, Powell signaled the U.S. central bank will remain patient and repeated that he wants to avoid chasing “transitory” inflation and potentially discouraging job growth in the process - a defense in effect of current Fed policy.

 

·         “Bolstering gold, Powell used the Delta ‘shield’ to buy time for more employment data before a taper announcement. It’s clear that the Fed won’t make a taper announcement until September or ideally November,” a trader based in New York said.

 

·         “You’d need next week’s jobs report to show a miss, a resurgence of the Delta variant or geopolitical risks with more news coming from Afghanistan for gold to break substantially higher,” Streible said.

 

·         Silver rose 2.2% to $24.05 an ounce, heading for its best week since May.

 

·         Platinum jumped 3.2% to $1,010.73 an ounce, while palladium climbed 0.8% to $2,411.54.

 

·         Biden vows retribution after 13 U.S. service members were killed in Afghanistan bombing

In a speech Thursday in which he said the United States would punish the Islamic State for a deadly attack on American service members and Afghans in Kabul, President Biden said he would send additional troops to aid Americans in Afghanistan if his military advisers ask — though he said that has not been requested.

 

The Islamic State attack at the Kabul airport, which included two suicide bombings, killed 13 U.S. troops and wounded 18.

 

·         U.S. launches drone strike on Islamic State after Afghan airport blast

 

Western forces running the Afghan airlift braced on Saturday for more attacks after the United States launched a drone strike, apparently killing an Islamic State "planner", two days after the group claimed a deadly bombing outside Kabul airport.

 

"Initial indications are that we killed the target. We know of no civilian casualties," the U.S. military said in a statement, referring to the overnight drone strike.

·         China reportedly weighs ban on U.S. IPOs from domestic tech companies with sensitive data

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Reference: CNBC, Business Report, Reuters, Worldometers