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U.S. inflation data boosts interest rate cut expectations, gold prices fall slightly and hold on to 4330, while crude oil weighs geopolitical influences
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Hello everyone, today XM Forex will bring you "[XM Forex]: US inflation data boosts interest rate cut expectations, gold prices fell slightly and stayed at 4330, crude oil weighs geopolitical influences." Hope this helps you! Original content is as follows:
In early trading in the Asian market on Friday (December 19, Beijing time), spot gold was trading around US$4,336 per ounce. The price of gold fell slightly on Thursday. Lower-than-expected US inflation data weakened the appeal of gold as a hedge against inflation. However, the support brought by rising unemployment during the same period limited the decline in gold prices; US crude oil was trading around US$56 per barrel, and the market was weighing the increasing supply-side risks due to the Russia-Ukraine peace talks and the situation in Venezuela.
BoJ Governor Kazuo Ueda held a monetary policy press conference. Several ECB officials spoke.
Stock Market
U.S. stocks rose across the board on Thursday, mainly due to lower-than-expected inflation data that boosted expectations for a rate cut by the Federal Reserve. At the same time, strong performance guidance from chip giant Micron highlighted the strong demand for artificial intelligence.
As of the close, the Dow Jones Industrial Index rose 0.14%, the S&P 500 Index rose 0.79%, and the Nasdaq Index rose 1.38%. The market rebounded from three-week lows, with the Russell 2000 index of small-cap stocks also up 0.8%.
The year-on-year increase in the U.S. consumer price index in November was lower than expected. This "constructive CPI report" further eased the policy pressure on the Federal Reserve. Although October and month-on-month data were not released due to the impact of the government shutdown, the market still regarded it as a positive signal. In addition, the number of initial jobless claims fell last week, indicating that the labor market remains stable. The interest rate futures market shows traders currently see a 58% chance of the Fed taking dovish action in March next year.
In terms of individual stocks, technology stocks performed outstandingly. Micron surged 10.2% as it reported quarterly profit guidance that was nearly double analysts’ expectations, reflecting concerns about AI.Strong demand. Shares of Trump Media & Technology Group soared 41% after the www.xmtraders.company announced an all-stock merger deal worth more than $6 billion with nuclear fusion www.xmtraders.company TAE Technologies. In addition, Lululemon rose 3.5% and Starbucks rose 4.9% due to the acquisition of shares by activist investors.
Gold Market
Gold prices fell slightly on Thursday as the market digested the latest US inflation data. Data showed that consumer prices rose 2.7% year-on-year in November, lower than the 3.1% expected, which weakened the appeal of gold as a hedge against inflation, but support from rising unemployment during the same period limited gold price declines.
As of the close, spot gold fell 0.2% to close at $4,330.39 per ounce. Market analysts believe that inflation is declining faster than expected, which reduces the need to buy gold as "inflation insurance" and is the main reason for the pressure on gold prices. However, analysts generally believe that the overall upward trend of gold has not changed. Some strategists have pointed the upward target to US$4,515.63 and believe that US$5,000 is still an effective target.
Spot silver fell 1.5% to $65.3 after hitting a record high of $66.88. Platinum and palladium performed strongly, with platinum rising 1.2%, hitting a new high in more than 17 years; palladium soaring 3.7%, hitting its highest level in nearly three years. Analysts pointed out that the precious metal's upward momentum has spread from silver to platinum, which is benefiting from strong demand.
Oil Market
International oil prices closed slightly higher on Thursday as the market weighed increasing supply-side risks arising from the Russia-Ukraine peace talks and the situation in Venezuela. Brent crude oil closed slightly up 0.2% at $59.82 a barrel; U.S. crude oil rose 0.4% to $56.15.
Geopolitics has become the focus of the market. According to Bloomberg, the United States is ready for a new round of sanctions on Russia’s energy industry in case Moscow refuses to accept the peace agreement. Meanwhile, President Trump said talks to end the war were "very close to progress," with U.S. and Russian officials meeting over the weekend.
In Venezuela, although the country’s state oil www.xmtraders.company has partially resumed loading operations after a cyber attack, the US blockade of sanctioned tankers has brought most of its exports to a standstill. Market analysis points out that if the blockade continues, local production may be forced to interrupt because there is nowhere to export.
Foreign Market
The U.S. dollar weakened against the Japanese yen and Swiss franc on Thursday, mainly due to lower-than-expected November inflation data in the United States, which reduced the appeal of the U.S. dollar; at the same time, the euro fell slightly after the European Central Bank kept interest rates unchanged.
Specific data shows that the U.S. consumer price index rose 2.7% year-on-year in November, lower than the 3.1% expected by the survey. This caused the USD/JPY to fall 0.12% to 155.50 yen; the USD/CHF fell 0.14%. The analysis pointed out that due to the previous long-term government shutdown that affected data collection, the accuracy of this inflation report is questionable.Markets are paying close attention to the more traditional PCE price index.
On the other hand, the euro fell 0.14% against the dollar to $1.17240. The European Central Bank decided to keep interest rates unchanged at the meeting that day and took a positive view on the resilience of the euro zone economy, but it did not change market expectations that interest rates would remain unchanged in the next two years.
The pound rose slightly by 0.09%** after the Bank of England announced its fourth interest rate cut this year. The market expects that the time for the next interest rate cut has been postponed. The Bank of Japan is almost certain to raise interest rates on Friday from 0.5% to 0.75%.
The above content is all about "[XM Foreign Exchange]: U.S. inflation data boosts interest rate cut expectations, gold prices fall slightly and hold on to 4330, crude oil weighs geopolitical influences". It is carefully www.xmtraders.compiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your trading! Thanks for the support!
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