On Wednesday (November 8th), investors searched for new clues about the Fed's interest rate stance, and gold prices fell for the third consecutive trading day on Wednesday.
Spot gold closed down $18.91 per ounce, or 0.96%, at $1950.16 per ounce on Wednesday.
COMEX December gold futures closed down $15.70 per ounce, or 0.80%, at $1957.80 per ounce.
COMEX December silver futures rose 0.62% to close at $22.728 per ounce.
Market News Analysis
The political risk premium accumulated by precious metals has begun to decline. This is because although the situation in the Middle East is unpredictable, there has not been a broader conflict.
Another factor contributing to the weakness of precious metals is the reduced demand for safe haven positions. Recently, the US dollar has continued to rise. Therefore, the fear of missed opportunities prompts traders to turn their attention to the stock market rather than non yielding assets.
Despite recent market trends, there are still reasons to be optimistic about precious metals. That is to say, a catalyst that may cause upward pressure on its prices is a pullback in interest rates. Last month, the yield of the US 10-year treasury bond bond broke 5.0%, but since then, it has sharply corrected. Today, the yield of the 10/30-year US treasury bond has dropped by at least 5 basis points. If this adjustment accelerates in the short term, then the background of gold and silver will become more constructive. However, the yield of US treasury bond bonds is still at a high level, but it has fallen back to the high level in more than ten years, cutting off the main bullish channel of spot gold price.
Due to the recent dominance of hawkish rhetoric by Federal Reserve policy makers, people hope that the Fed can achieve its goal of curbing inflation, and gold prices are once again facing selling pressure on Wednesday. Market participants had hoped that Federal Reserve Chairman Powell would adopt a different tone in his speech at the Federal Reserve's statistical meeting. However, the Chairman of the Federal Reserve was unable to touch on monetary policy, but he will continue his speech tomorrow and may still touch on monetary policy at that time. However, due to investors becoming cautious before the Fed's Powell speech, gold prices may struggle to recover.
Daniel Ghali, commodity strategist at TD Securities, said, "Traders will start to focus on economic data and potential actions by the US central bank. Gold will react based on the data
Rich Checkan, President and Chief Operating Officer of Asset Strategies International, said, "If national institutions directly intervene in conflicts, I will see a significant increase in gold prices." "We may see $2200 per ounce. But I don't think prices will rise significantly
Investors need to note that the weekly unemployment benefit application report will be released this Thursday. The next important report for the United States will be the Consumer Price Index on November 14th.
Focus on financial data and events on Thursday (Beijing time)
① 09:30 China's October CPI annual rate
② 16:35 Bank of Japan Governor Kazuo Shibata in an interview
③ 21:30 Number of initial claims for unemployment benefits for the week from the United States to November 4th
④ 22:30 Federal Reserve Bostick and Barkin deliver speeches
⑤ The next day at 00:00, Federal Reserve Barkin delivered a speech
⑥ The next day at 01:30, European Central Bank President Lagarde delivered a speech
⑦ At 03:00 the next day, Federal Reserve Chairman Powell delivered a speech
