On Tuesday (December 12), the rebound of gold price was blocked. Earlier, spot gold rebounded around 1996 dollars. However, after the US inflation data in November met analysts' expectations, the benchmark yield of US 10-year treasury bond bonds began to rise, making the gold price give back its gains.
Spot gold closed at $1979.26 per ounce on Tuesday, a decrease of 0.13%.
Gold prices gave back the gains after the release of US CPI data. COMEX futures remained largely unchanged at $1993.2 per ounce; COMEX silver futures fell 0.2% to $23.016 per ounce; NYMEX platinum futures rose 1.7% to $931 per ounce; NYMEX palladium futures rose 1.8% to $982.3 per ounce.
Market news analysis
The US Bureau of Labor Statistics (BLS) revealed that the process of deflation in the United States is still ongoing, with an overall inflation rate of 3.1%, lower than October's 3.2%, but the basic inflation rate remains at 4% for the 12 months ending in November. The monthly data is mixed, with a CPI of 0.1%, exceeding expectations by 0%; The core CPI is 0.3%, which is in line with expectations but higher than in October.
The release of this data supported the gold price to rise to a daily high, but due to the recovery of US treasury bond bond yield, the gold price gave up its gains and fell below the 1980 US dollar/ounce mark. Although the US dollar index remains weak, gold is still unable to recover from its recent decline.
On Tuesday, gold prices attempted to rebound and reach a high of around $1996 per ounce, and sellers took control of the situation after the release of the US CPI. The rise in monthly inflation data means that the Federal Reserve is unlikely to commit to a rate cut at tomorrow's meeting. This led to a temporary rise in the yield of US treasury bond bonds and pushed the gold price back to the key support area.
Dailyfx analyst Zain Vawda predicts, "Due to the continued severe geopolitical tensions, gold may continue to be supported and attract buyers in the event of a significant decline. The attractiveness of precious metals remains high, and due to the inevitable interest rate cut at some point in 2024, gold prices may remain above the $1800/ounce mark for the foreseeable future."
The market generally expects the Federal Reserve to maintain its current benchmark interest rate of 5.25% -5.5% unchanged, with a focus on next year's interest rate forecast and Federal Reserve Chairman Powell's press conference. Investors will seek the dovish hints in Powell's remarks to reignite hopes of a rate cut in early 2024, which will bring new boost to gold prices.
[Focus on financial data and events on Wednesday trading day (Beijing time)]
① 3:00 PM UK October Three Month GDP Rate, UK October Quarterly Adjusted Commodity Trade Account, UK October Industrial and Manufacturing Output Monthly Rate
② 18:00 Eurozone October Industrial Output Monthly Rate
③ 21:30 Annual and monthly PPI rates for November in the United States
④ 23:30 EIA crude oil inventory for the week from the United States to December 8th, EIA Cushing crude oil inventory for the week from the United States to December 8th, and EIA strategic petroleum reserve inventory for the week from the United States to December 8th
⑤ The next day at 03:00, the Federal Reserve released a summary of its interest rate resolution and economic expectations
⑥ The next day at 03:30, Federal Reserve Chairman Powell held a press conference
