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Gold gains on softer dollar as Fed signals slowdown in rate hikes

 

 

“The biggest adventure you can take is to live the life of your dreams.”– Michael Jordan 

 

 

HEADLINES

 

 

  • Dollar extends losses as Fed minutes signal slower rate hikes
  • Gold gains on softer dollar as Fed signals slowdown in rate hikes
  • Oil falls as supply-disruption fears ease amid Russian price cap talks
  • Dollar nears 3-mth low, shares climb after Fed tests the brakes
  • Binance deploys $1 billion to keep crypto industry afloat after FTX collapse
  • USD/CAD: Losses to pick up momentum on a break below 1.3310 – Scotiabank
  • GBPUSD Near Term: Upside favored

 

 

Dollar extends losses as Fed minutes signal slower rate hikes

 

The U.S. dollar extended losses on Thursday after the minutes from the Federal Reserve's November meeting supported the view that the central bank would downshift and raise rates in smaller steps from its December meeting.

The eagerly awaited readout of the Nov. 1-2 meeting showed officials were largely satisfied they could now move in smaller steps, with a 50 basis point rate rise likely next month after four consecutive 75 basis point increases.

The dollar index , which measures the greenback against six major peers, was down 0.2% at 105.75, after sliding 1.1% on Wednesday.

 

 

COMMODITIES

 

 

Gold gains on softer dollar as Fed signals slowdown in rate hikes

 

Gold prices rose to a near one-week high on Thursday on a weaker dollar, after minutes from the U.S. Federal Reserve’s November meeting signalled it may soon slow the pace of interest rate hikes.

Spot gold rose 0.4% to $1,756.66 per ounce by 11:08 a.m. ET (1608 GMT). U.S. gold futures advanced 0.7% to $1,756.90.

The U.S. central bank delivered a fourth consecutive 75 basis-point (bps) rate hike earlier this month, and market participants now widely expect a 50 bps rate increase at the December meeting.

 

 

ENERGY

 

Oil falls as supply-disruption fears ease amid Russian price cap talks

 

Oil prices fell on Thursday, extending losses from the previous session, as fears of supply disruption eased on news that the Group of Seven (G7) nations were considering a high price cap on Russian oil.

A greater-than-expected build-up in U.S. gasoline inventories added to downward pressure.

Brent crude futures had slid 43 cents, or 0.5%, to $84.98 a barrel by 0102 GMT, while U.S. West Texas Intermediate futures dropped 35 cents, or 0.5%, to $77.59 a barrel.

Both benchmark contracts plunged more than 3% on Wednesday on news that the planned price cap could be above the current market level.

 

 

STOCKS

 

 

Dollar nears 3-mth low, shares climb after Fed tests the brakes

 

Shares hit a two-month high and the dollar swooped towards a three-month low on Thursday, after Federal Reserve signals of smaller interest rate rises from next month were followed by the message from Frankfurt that the ECB will plough on.

With Wall Street shut for Thanksgiving, it was up to Europe to continue the rebound in market confidence that has been building for more than a month.

It seemed a bit of a struggle early on when London's FTSE refused to budge, but there were just enough gains in the rest of Europe and in Asia overnight to ensure things kept shuffling forward.

 

 

Binance deploys $1 billion to keep crypto industry afloat after FTX collapse

 

Cryptocurrency exchange Binance on Thursday announced new details about its industry recovery fund, which aims to prop up struggling players in the wake of FTX’s calamitous bankruptcy.

In a blogpost, Binance said it will devote $1 billion in initial commitments to the recovery fund. It may increase that amount to $2 billion at a point in time in the future “if the need arises,” the company added.

It has also received $50 million in commitments from crypto-native investment firms including Jump Crypto, Polygon Ventures, and Animoca Brands.

 

 

ANALYSIS

 

 

USD/CAD: Losses to pick up momentum on a break below 1.3310 – Scotiabank 

 

“Spot’s turn lower from Monday’s high/retest of the head and shoulders breakdown at 1.3495 looks a little more emphatic now, with steady losses pushing the USD back to the low 1.33s.”

“Intraday charts reflect firm USD selling pressure on USD gains above 1.34 yesterday and we look for better selling pressure on modest gains to curb the USD today and perhaps into tomorrow.”

“Support is 1.3310 intraday. USD losses should pick up momentum on a break below here.”

 

 

CHART

 

 

GBPUSD Near Term: Upside favored

 

Technical View: Long position above 1.206. Target 1.217. Conversely, break below 1.206, to open 1.2015.

Comments: The pair breaks above the resistance.

 

 

 

 

Source: Trading Central 

 

 

CALENDAR

 

 

*Times in GMT

 

 

 

 

Source: FX Street Economic Calendar

 


Footnotes
https://www.reuters.com/markets/currencies/dollar-slips-risk-sentiment-improves-after-fed-minutes-2022-11-24/
https://www.reuters.com/article/global-precious/precious-gold-gains-on-softer-dollar-as-fed-signals-slowdown-in-rate-hikes-idUSL4N32K2PN
https://www.cnbc.com/2022/11/24/oil-falls-as-supply-disruption-fears-ease-amid-russian-price-cap-talks.html
https://www.reuters.com/markets/global-markets-wrapup-1-pix-2022-11-24/
https://www.cnbc.com/2022/11/24/binance-creates-1-billion-crypto-industry-fund-after-ftx-collapse.html
https://www.fxstreet.com/news/usd-cad-losses-to-pick-up-momentum-on-a-break-below-13310-scotiabank-202211241428

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