Gold jumps with US inflation highest since 2008

“We are fond of saying that if these strategies are truly horribly overcrowded then someone has apparently forgotten to tell the prices.” – Clifford Asness

 

FOREX

 

Dollar edges down after inflation data, ahead of FOMC

 

After adopting a wait-and-see attitude all week, sucking volatility from the market and leaving major currencies mostly range-bound, Thursday’s developments appeared to add little new direction to currency markets.

 

In the United States, data showed that the number of Americans filing new claims for unemployment benefits fell last week to the lowest level in nearly 15 months, while consumer prices increased further in May as the pandemic’s easing grip on the economy continued to boost domestic demand.

 

Canadian dollar rises as investors eye further cuts to BoC stimulus

 

The Canadian dollar edged higher against its U.S. counterpart on Thursday, as oil prices rose and comments from a senior Bank of Canada policymaker supported expectations for further reduction of stimulus from the central bank as soon as next month. 

 

BoC Deputy Governor Timothy Lane said that recent data show signs of increasing resilience in the economy that bodes well for the recovery.     

 

COMMODITIES

 

XAU/USD bid on dovish FOMC expectations

 

The fear was that another strong inflation print could once again spark talk of taper talks that could weigh on gold as the transitory or not debate rages on. However, instead, gold collected a bid as the US dollar sank in a market priced for a dovish Federal Open Market Committee next week. 

 

Oil hits two-year highs on rising demand expectations

 

Oil prices edged up to their highest in over two years in volatile trade on Thursday, on optimism for strong economic demand after new U.S. unemployment claims fell to their lowest since the country’s first wave of COVID-19 last year.
The market shook off a brief plunge after media reports suggested the United States lifted sanctions on Iranian oil officials.

 

STOCKS

 

S&P 500 brushes off rising inflation to hit record high

 

U.S. stocks rose on Thursday and the S&P 500 hit a record intraday high as investors juggled signs of a swift economic recovery with concerns over the Federal Reserve tapering its massive monetary stimulus.

 

CRYPTO

 

IMF sees legal, economic issues with El Salvador bitcoin move

 

The International Monetary Fund said on Thursday it has a number of economic and legal concerns regarding the move from El Salvador to make bitcoin a parallel legal tender.

 

“Adoption of bitcoin as legal tender raises a number of macroeconomic, financial and legal issues that require very careful analysis,” said Gerry Rice, an IMF spokesman, during a scheduled press briefing.

 

MORE HEADLINES

 

•    U.S. Treasury's Yellen says Congress needs to fund debt relief programs
•    GameStop falls 27% on potential share sale, other 'meme stocks' falter
•    Chinese ride-hailing firm Didi discloses U.S. IPO plans
•    BlackRock outlines investment push into private markets
•    'CryptoPunk' NFT sells for $11.8 million at Sotheby's
•    Israel's monday.com valued at nearly $7.6 billion in Nasdaq debut

 

ANALYSIS

 

ECB’s stance suggests higher yields will have to wait for a bit longer – Nordea Markets

 

“The September meeting is set to be very interesting, since it could also include conclusions from the ECB’s strategy review, which the ECB has said will be concluded during the second half of the year. The monetary policy setup could potentially then be tweaked in other ways as well in September.”

 

“After the downward moves already seen in the past weeks, we do not see much further room for longer bond yields to fall. The continued high pace of ECB buying supports yields at close to current levels over the coming few months, but we expect longer yields to aim higher, curves to steepen and intra-Euro-area spreads to widen again towards the autumn. We also think the EUR/USD will aim lower later in the summer.”

 

CHART

 

Gold – 4 hour Candlesticks
  

Source: GKFX Prime Metatrader 4 

After forming a new higher low and connecting the two previous lows with a rising trendline, gold has broken above a declining trendline connecting the highs since June 1 is a possible bullish breakout. - Prepared by Trading Writers*

 

CALENDAR

 

*Times in GMT

 

 
Source: FX Street Economic Calendar

 

Source

 

https://www.fxstreet.com/economic-calendar
https://www.fxstreet.com/news/gold-price-analysis-xau-usd-bid-on-dovish-fomc-expectations-202106101928
https://www.reuters.com/business/futures-hold-steady-ahead-inflation-data-2021-06-10/
https://www.reuters.com/article/us-usa-treasury-yellen/u-s-treasurys-yellen-says-congress-needs-to-fund-debt-relief-programs-idUSKCN2DM2ED
https://www.reuters.com/article/canada-forex/canada-fx-debt-canadian-dollar-rises-as-investors-eye-further-cuts-to-boc-stimulus-idUSL2N2NS2XS
https://www.reuters.com/article/global-forex/forex-dollar-edges-down-after-inflation-data-ahead-of-fomc-idUSL2N2NS2OJ
https://www.reuters.com/article/global-oil/update-7-oil-hits-two-year-highs-on-rising-demand-expectations-idUSL2N2NS05V
https://www.reuters.com/business/blackrocks-fink-says-has-no-plans-leave-firm-good-hands-2021-06-10/