Gold pares weekly gains as Jackson Hole speeches rollout

Markets slip into a consolidation zone as central bankers avail Jackson Hole as an opportunity to push back policy pivot concerns. Adding strength to the cautious mood are the mixed concerns about China and the latest rebound in the US Treasury bond yields.

As a result, the US Dollar managed to refresh the multi-week high and drown the major currencies, as well as the Antipodeans, not to forget pausing the Gold Price upside. However, Crude Oil extends the previous day’s rebound amid hopes of witnessing sooner end to the restrictive monetary policies and expectations of getting more stimulus from China.

With this, the Gold Price seesaw at a two-week high while consolidating the first weekly gain in five whereas the Brent Oil gains near 1.0%. The same restricts USDCAD run-up but weighs on the JPY, NZD and GBP. Furthermore, EURUSD dropped the most among the major currency pairs as the second-tier ECB policymakers failed to defend the rate hikes despite pushing back recession woes.

Elsewhere, another scam in crypto markets joins Mastercard’s termination of partnerships with key players to weigh on BTCUSD and ETHUSD amid a broadly firmer US Dollar. Alternatively, hopes of witnessing more crypto support from BRICS put a floor under the prices of Bitcoin and Ethereum.

Following are the latest moves of the key assets:

• Brent oil rises for the second consecutive day, up 0.90% intraday to near $84.00 by the press time.
• Gold price prints the first daily loss in five around $1,915, down 0.10% on a day as we write.
• USD Index refreshes a 2.5-month high around 104.30 at the latest.
• Wall Street benchmarks closed in the red and weighed on the stocks in the Asia-Pacific zone. That said, equities in Europe and UK trade mixed as we write.
• BTCUSD remains mildly offered around $26,000 but ETHUSD holds lower grounds near $1,650 by the press time.

US data, Fed talks propel US Dollar, prod Gold buyers

Thursday’s mostly upbeat US data joined the recently hawkish comments from Fed officials to fuel the US Dollar and challenge the intraday sellers of Gold. On the same line are the fears of China’s inability to push back the soft landing, as well as the strong yields.

Earlier in the day, some of the Fed and ECB policymakers tried to justify the rate hikes but the US data managed to defend the Greenback buyers while the Euro didn’t have the liberty to recover amid recession woes.

On a different page, technology shares witnessed fresh downside pressure and weighed on the Asia-Pacific shares even as PBOC tried to limit the pessimism.

It should be noted that the pessimism at the crypto fund keeps the BTCUSD and ETHUSD pressured even as the BRICS show positive signs of supporting the system.

• Strong buy: USDCAD
• Strong sell: ETHUSD, GBPUSD, Gold
• Buy: USD Index, Nasdaq, USDJPY
• Sell: DAX, FTSE 100, BTCUSD, AUDUSD, EURUSD

All eyes on Fed’s Powell, ECB’s Lagarde

While a slew of central bankers are up for speaking at Jackson Hole and will be closely observed for clear directions, Fed Chair Jerome Powell and ECB President Christine Lagarde will be observed closely due to their market dominance.

That said, the latest US Dollar run-up signals that Powell’s hawkish statements are mostly priced-in and hence he needs to offer something interesting to defend the US Dollar bulls. On the other hand, ECB’s Lagarde is less likely to please the Euro buyers despite pushing back the rate cut bias.

May the trading luck be with you!