USD (US Dollar) Seems To Be The Key Opponent Of Gold Price At The Moment. FOMC Minutes Ensures Of Fed's Goal

Sentiment is mixed. The S&P500 eked out small gains after a volatile session. The FOMC minutes, released yesterday, came as a confirmation that the Federal Reserve (Fed) remains fully committed to bringing inflation down, even if it means slower growth. But, the recession talk, lower energy prices, and the softening Fed hawks despite yesterday’s hawkish minutes weigh on the US 10-year yield, and the the 2-10 year portion of the US yield curve inverted, which is read as ‘recession’ is either here, or about to hit the fan.

Gold prices are on a freefall mode due to the strong dollar, and silver extends losses below $20 level. The mint ratio is above 90, hinting that either gold is still expensive, or silver is relatively cheap. But whether their prices will go up or down depends on US dollar. The dollar trades at 20-year highs, and keeps pushing higher. Activity in Fed funds futures price in more than 93% chances for a 75bp hike by the end of this month, but many people think that the deteriorating economy since the Fed’s June could bring the Fed to hike by 50bp only instead of 75bp this month. The market chatter hints that the market pricing has room to get more dovish rather than more hawkish. In oil, we now see a clear pivot, as investors prefer selling tops rather than buying dips. Tensions between G7 and Russia is an upside risk in the short run, but if the attention remains on demand side, we could see limited upside, and a further downside in oil prices.

Watch the full episode to find out more!

• 0:00 Intro
• 0:27 Market update
• 2:35 Why is gold falling?
• 4:46 Fed expectations may soften, despite hawkish FOMC minutes
• 6:37 But what matter is energy…

Ipek Ozkardeskaya

Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020. #Gold #silver #crude #oil #topselling #dipbuying #inflation #recession #USD #Bloomberg #misery #index #Fed #FOMC #minutes #SPX #Dow #Nasdaq #investing #trading #equities #stocks #cryptocurrencies #FX #bonds #markets #news #Swissquote #MarketTalk #marketanalysis #marketcommentary _____ Learn the fundamentals of trading at your own pace with Swissquote's Education Center. Discover our online courses, webinars and eBooks: https://swq.ch/wr _____ Discover our brand and philosophy: https://swq.ch/wq Learn more about our employees: https://swq.ch/d5 _____ Let's stay connected: LinkedIn: https://swq.ch/cH