Gold continues its resounding fall without stopping…steps away from breaking the 1800! Powered by Investing.com

Investing.com – It declined strongly during trading, today, Friday, affected by the surprising unemployment and producer prices data that was issued yesterday, Thursday, as these data transformed the scene in the markets, as the various assets reflected their trends moments after their issuance. As this data reinforced expectations of further tightening in .

Gold: savings, investment, speculation

Gold has been on the top of safe investment assets over the past few years, as it is the safest tool for preserving and maximizing money, whether it is saving, investing, or even speculation.

In this free webinar provided by “Investing Saudi Arabia”, we will learn important details about gold trading, through a comprehensive technical and fundamental analysis provided by trading expert A. Ghaith Abu Al-Hilal.

To apply, click here

gold now

It recorded strong declines during the current moments, to reach levels near $ 1819 an ounce, by 0.95%.

Also, futures contracts for the yellow metal fell during these moments of today’s trading, at levels near $ 1827 an ounce, by 1.3%.

While it rose in the current moments to the levels of 104.4 points, an increase of 0.6%.

Ilya Spivak, head of global macroeconomics at TastyLife, said this week’s data showing strong retail sales and rising consumer prices in the United States “seems to be fueling a reassessment…Markets think the Fed is going to tighten further, and that’s bad.” Too much for gold.

The most important levels

Fed statements after the data was released yesterday

She said, Loretta Meister, after the release of higher and higher-than-expected PPI data by talking about the Fed and its next step against inflation.

Fed Meister said: “The extent to which the Fed will reach interest rates is mainly related to inflation, and at our last meeting there was no proposal to raise interest rates by 50 basis points instead of 25 basis points.”

Meister added, “There is a greater risk that we underestimate and control inflation, and what is clear is that current inflation levels are still very high.”

Meister confirmed that the CPI data for January guides us that there is still a lot of work required to bring down inflation towards the 2% target.

And she continued: “The Fed’s steps and policy will certainly lead to a decrease in the growth rate of the US economy and a strong increase in the unemployment rate. The journey to reaching price stability will be painful.”

Regarding the reversal of inflation and its rise again, Meister said that fear remains.

And about the existence of a movement more violent than the Fed in the upcoming meetings, Loretta said that this may happen if the data reveals a reverse movement of inflation. She said that the Fed could accelerate the pace of raising interest rates if the conditions are appropriate for that.

gold forecast

Better-than-expected economic data and persistently high inflation caused markets to turn around again, with the idea of ​​a hike back in the fore.

According to the latest research by Daniel Ghaly, Chief Commodities Strategist at TD Securities, this environment could continue to affect the precious metals sector.

“So far, the bullish trend that has formed in precious metals prices is not compatible with a large number of soft jobs data that increased the risk that the Fed will not be able to cut interest rates in 2023. This scenario is likely to see Markets are back to the downside, as we estimate the trend is near $1,750 an ounce over the coming months.”

Yesterday’s data

The headline monthly record for January increased by 0.7%, while experts expected it to rise by 0.4% in this month, after declining by -0.2% last December.

And annually, it increased from January by 6.0%, while experts expected it to rise by only 5.4%, while the annual data recorded, in the previous reading, an increase of 6.5% after revision.

The Producer Price Index (excluding food and energy) monthly rose by 0.5%, above expectations of a 0.3% rise. It rose annually by 5.4%, while experts expected it to rise by only 4.9%.

The US economy received 194 thousand jobless claims, which is less than the expected 200 thousand jobless claims.

Thus, the average number of jobless claims rose in 4 weeks to 189.50 thousand, instead of 189.00 thousand after the revision last week.