Tag: Gold

  • Moody’s Downgrade Disrupts Calm from Tariff Truce, Dollar Faces New Test

    Moody’s Downgrade Disrupts Calm from Tariff Truce, Dollar Faces New Test


    Just as markets were finding their footing following a series of positive trade developments, Moody’s delivered a late-week shock by downgrading the US sovereign credit rating from Aaa to Aa1. The move overshadowed the optimism sparked by the US-China tariff truce and the broader de-escalation of trade tensions.

    The trade outlook appears less volatile in the near term, with more agreements possibly in the pipeline. Markets may enjoy a reprieve from tariff headlines until early July for non-China partners, and until mid-August for China.

    However, that stability could be abruptly shaken by Moody’s downgrade. The timing of the downgrade coincides with fragile improvements in sentiment, raises the risk of renewed selling in both Treasuries and Dollar.

    In the currency markets, performance was mixed last week, a hallmark of broader consolidation. Dollar finished as the strongest currency but notably failed to build on its early-week strength. Aussie followed as the second-best performer, buoyed by strong domestic job data and risk appetite, while Sterling also held firm with support from strong UK GDP. However, gains were limited overall. On the weaker side, Euro posted the poorest performance, followed by Swiss Franc and Kiwi. Yen and Loonie ended the week in the middle.

    Wall Street Surges on Trade Truce, Even Though Soaring Inflation Expectations Reinforce Fed Patience

    US equity markets wrapped up the week with strong gains, driven by renewed optimism over global trade and investor resilience, despite worrying economic signals. S&P 500 surged 5.3%, DOW added 3.4%, and NASDAQ Composite outperformed with a 7.2% jump. The rally was initially sparked by the surprising outcome of the US-China trade meeting. Both sides agreed to a 90-day truce and rolled back a significant portion of the tariffs, though not fully returning to pre-conflict levels.

    Investors looked past several downside risks and pushed stock prices higher, even as economic data pointed to potential trouble ahead. Markets absorbed weak consumer sentiment and sharply rising inflation expectations without flinching. This reflects a broader hope that trade normalization will continue to offset macro headwinds, at least in the short term.

    The University of Michigan’s preliminary consumer sentiment report for May, released Friday, highlighted growing public anxiety. The headline index dropped to 50.8, its second-lowest reading on record. Year-ahead inflation expectations surged from 6.5% to 7.3%, the highest since 1981.

    Importantly, the survey was conducted between April 22 and May 13. That timeframe includes the period after US President Donald Trump announced that reciprocal tariffs on all trading partners other than China would be scaled back to a 10% baseline. It also includes responses collected a day after the US-China truce was declared.

    In that context, the persistent collapse in sentiment and worsening inflation outlook suggest that consumers remain highly skeptical about the economic direction. Even the rollback of some tariffs was not enough to lift the mood or tame concerns about rising prices. Attention will now be on the final May release due May 30, to see if sentiment and expectations shift more positively as the trade truce sinks in.

    For Fed, the data likely reinforce a cautious stance, for holding back from another rate cut for longer. Fed funds futures now reflect just a 36% chance of a 25bps rate cut in July. Expectations rise to 75% for a September cut, followed by around 70% odds of another in December. That suggests markets believe only two rate cuts are likely this year, if any.

    Technically, S&P 500 gapped higher at the start of the week and extended its rally from 4835.04 low. The current rise is still viewed as the second leg in the medium-term corrective pattern from the 6147.43 high. Momentum should start to fade above 6000 psychological level. A break below 5720.10 gap support would indicate short-term topping. Sustained trading below 55 Day EMA (now at 5650.80) would suggest that the third leg of the correction has already begun.

    Moody’s Downgrade Casts Shadow Over Dollar and Treasuries

    Despite a strong weekly finish for Wall Street and Dollar, sentiment faces a fresh challenge after Moody’s downgraded the US sovereign credit rating on Friday. The move, announced after markets closed, cut the rating by one notch to Aa1 from Aaa—marking a rare loss of top-tier status. While the immediate market reaction was muted due to timing, the downgrade could cast a shadow over financial markets in the coming week, with pressure potentially building on both Dollar and US Treasuries.

    Notably, Dollar ended as the top-performing major currency last week, but it did so without conviction. After Monday’s initial surge, momentum faded quickly. By midweek, the greenback began to stall, showing little follow-through despite stronger inflation expectations. That suggests underlying demand may be fragile.

    Moody’s cited deteriorating fiscal outlook as the key reason for the downgrade, pointing to “successive US administrations and Congress” that have failed to reverse the trend of widening deficits and rising debt servicing costs. The agency also expressed skepticism that meaningful fiscal reforms are on the horizon, making clear that the downgrade reflects more than just short-term political risks. The downgrade reflects not only mounting fiscal stress, but also the political impasse that continues to hinder structural reforms.

    This backdrop is especially important given how markets reacted in early April, when sweeping reciprocal tariffs imposed by the US triggered a rally in Treasury yields and broad weakening of Dollar. That episode suggested investors may be reassessing traditional assumptions about the US’s role as the ultimate safe asset provider. A similar dynamic could resurface if the Moody’s downgrade gains traction with bondholders or sparks broader credit rating scrutiny.

    Technically, 10-year yield’s strong rise last week suggests that near term correction from 1.4592 has already completed at 4.124. Rise from 3.886 might be ready to resume. Further rally is now in favor as long as 55 D EMA (now at 4.3437) holds. Firm break of 4.592 would target 100% projection of 3.886 to 4.592 from 4.124 at 4.830 next.

    Dollar Index’s corrective recovery from 97.92 continued last week, but started to struggle ahead of 55 D EMA (now at 101.93). While another rise cannot be ruled out, upside should be limited by 38.2% retracement of 110.17 to 97.92 at 102.60. On the downside, break of 99.17 support will argue that larger down trend is ready to resume through 97.92 low.

    One asset that could benefit from renewed stress on the Dollar and Treasuries is Gold. Technically, Gold is now at an ideal level to complete the corrective pullback from 3499.79 high. Current levels include 55 D EMA (now at 3152.88) and 38.2% retracement of 2584.24 to 3499.79 at 3150.04. On the upside, firm break of 3262.74 resistance should bring stronger rally back to 3434.76/3499.79 resistance zone.

    EUR/USD Weekly Outlook

    EUR/USD dived further to 1.1064 last week but recovered ahead of 38.2% retracement of 1.0176 to 1.1572 at 1.1039. Initial bias remains neutral this week first. Strong support is still expected from 1.1039 to complete the correction from 1.1572. On the upside, above 1.1292 will bring stronger rise back to retest 1.1572. However, sustained break of 1.1039 will dampen this view and target 61.8% retracement at 1.0709 next.

    In the bigger picture, rise from 0.9534 long term bottom could be correcting the multi-decade downtrend or the start of a long term up trend. In either case, further rise should be seen to 100% projection of 0.9534 to 1.1274 from 1.0176 at 1.1916. This will now remain the favored case as long as 55 W EMA (now at 1.0818) holds.

    In the long term picture, the case of long term bullish reversal is building up. Sustained break of falling channel resistance (now at around 1.1300) will argue that the down trend from 1.6039 (2008 high) has completed at 0.9534. A medium term up trend should then follow even as a corrective move. Next target is 38.2% retracement of 1.6039 to 0.9534 at 1.2019.



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  • Gold on the rollercoaster – Commerzbank

    Gold on the rollercoaster – Commerzbank


    “The price of Gold went on a bit of a rollercoaster ride on Thursday, Commerzbank’s Head of FX and Commodity Research Thu Lan Nguyen notes.

    Gold Swings $100 as trade tensions ease, inflation cools

    “After briefly dipping towards $3,120 per troy ounce, it recovered by more than $100 at times over the course of the day. The reason for the back and forth was the recent easing of tensions in the US trade conflict, which reduced demand for safe havens on the one hand, and weak US inflation data on the other. Following the weaker-than-expected consumer price data on Tuesday, producer prices in April yesterday also indicated that price pressure has so far remained subdued.”

    “This gave new impetus to expectations of US interest rate cuts, which in turn benefited Gold as an interest-free investment. Ultimately, however, developments in the trade conflict are likely to outweigh short-term economic data and interest rate expectations. After all, the rapid rise in the price of Gold by more than 30% at times since the beginning of the year cannot be explained solely by the market’s expectations of interest rate cuts, but is likely to be largely due to a flight to safe havens.”

    “If further ‘deals’ are announced between the US and its trading partners in the coming weeks, the price of Gold is likely to continue its downward trend.”



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  • Weak Data Overlooked as Yen Rises on Risk-Off Mood

    Weak Data Overlooked as Yen Rises on Risk-Off Mood


    Mild risk-off mood is helping Yen to extend its near-term rebound, despite fresh signs of economic weakness at home. Japan’s economy was already showing signs of strain even before the impact of US tariffs, with Q1 GDP contracting more sharply than expected. BoJ is left in an increasingly precarious position, wedged between deteriorating growth and persistent inflationary pressures.

    A recent Reuters poll taken between May 7 and 13 revealed a significant shift in market expectations, with 67% of economists now projecting that BoJ will hold its policy rate at 0.50% through the third quarter. That’s up sharply from just 36% a month ago, highlighting how tariff-related risks have changed expectations for near-term tightening.

    On the trade front, Japan is preparing a third round of negotiations with the US, as it seeks to secure exemptions from tariffs on automobiles and auto parts. In return, Tokyo is reportedly considering a set of concessions, including increased imports of US corn and soybeans, regulatory changes to auto inspection standards, and cooperation in shipbuilding technology.

    Chief negotiator Ryosei Akazawa is expected to travel to Washington as early as next week, though the timeline hinges on progress in working-level talks. Meanwhile, Finance Minister Katsunobu Kato will travel to Canada for G7 meetings, where he may hold bilateral discussions with US Treasury Secretary Scott Bessent on foreign exchange matters.

    Overall for the week so far, Yen is currently the top performer, followed by Sterling and then Dollar. Kiwi is the weakest, trailed by Euro and Swiss Franc. Loonie and Aussie sit in the middle of the pack. The overall tone in the currency markets remains mixed.

    Technically, Gold has bounced from key cluster support around 3150, including 55 D EMA (now at 3151.09) and 38.2% retracement of 2584.24 to 3499.79 at 3150.04. It’s possible that correction from 3499.79 has completed already. Firm of 3265.74 will reinforce this bullish case, and suggest that larger up trend is ready to resume. If realized, that should be accompanied by another round of selloff in Dollar. However, sustained break of 3150 will dampen this view and bring deeper fall to 61.8% retracement at 2933.98.

    In Asia, at the time of writing, Nikkei is down -0.06%. Hong Kong HSI is down -0.40%. China Shanghai SSE is down -0.34%. Singapore Strait Times is down -0.20%. Japan 10-year JGB yield is down -0.016 at 1.463. Overnight, DOW rose 0.65%. S&P 500 rose 0.41%. NASDAQ fell -0.18%. 10-year yield fell -0.073 to 4.455.

    Looking ahead, Eurozone trade balance in the main feature in European session. Later in the day, US will release housing starts and building permits, and import prices. But attention will be on U of Michigan consumer sentiment and inflation expectations.

    Japan’s GDP contracts -0.2% qoq in Q1, export drag offsets capex gains

    Japan’s economy shrank by -0.2% qoq in Q1, marking its first contraction in a year and falling short of the -0.1% qoq consensus. On an annualized basis, GDP contracted by -0.7%, a sharp disappointment compared to expectations for -0.2%.

    The weakness was largely driven by external demand, which subtracted -0.8 percentage points from growth as exports declined -0.6% qoq while imports jumped 2.9% qoq.

    Domestically, the picture was mixed. Private consumption, comprising more than half of Japan’s output, was flat on the quarter. However, capital expenditure provided some support, rising by a solid 1.4% qoq.

    Meanwhile, inflation pressures showed no sign of easing, with the GDP deflator accelerating from 2.9% yoy to 3.3% yoy, above expectations of 3.2% yoy.

    RBNZ inflation expectations rise to 2.41%, further easing seen ahead

    RBNZ’s latest Survey of Expectations for May revealed a notable uptick in inflation forecasts across all time horizons.

    One-year-ahead inflation expectations climbed from 2.15% to 2.41%, while two-year expectations rose from 2.06% to 2.29%. Even long-term projections edged higher, with five- and ten-year-ahead expectations increasing to 2.18% and 2.15% respectively.

    Despite the upward revisions in inflation outlook, expectations for monetary policy point clearly toward easing.

    With the Official Cash Rate currently at 3.50%, most respondents anticipate a 25 bps cut by the end of Q2. Looking further ahead, the one-year-ahead OCR expectation also declined from 3.23% to 2.91%.

    NZ BNZ manufacturing rises to 53.9, recovery gains ground

    New Zealand’s BusinessNZ Performance of Manufacturing Index edged up from 53.2 to 53.9 in April. The gain was driven by improvements in employment and new orders, up to 55.0 and 51.4 respectively, with employment reaching its highest level since July 2021. However, production eased slightly to 53.8.

    BNZ Senior Economist Doug Steel noted that while the sector isn’t booming, the recovery is clear, with the PMI rebounding sharply from a low of 41.4 last June.

    Still, he cautioned, “there remain questions around how sustainable it is given uncertainty stemming from offshore”.

    Fed’s Barr: Solid economy faces threats from tariff-driven supply disruptions

    Fed Governor Michael Barr highlighted solid growth, low unemployment, and continued progress on disinflation in the US economy. However, he flagged growing concern over rising trade-related uncertainty, which has begun to weigh on consumer and business sentiment.

    In a speech overnight, Barr specifically pointed to the vulnerability of small businesses, which are more exposed to “disruptions to supply chains and distribution networks”.

    These firms are integral to broader production networks, and failures in this segment could trigger cascading effects across the economy.

    Drawing a parallel to the pandemic, Barr noted that “disruptions can have large and lasting effects on prices, as well as output,” leading to lower growth and higher inflation ahead.

    USD/JPY Daily Outlook

    Daily Pivots: (S1) 145.13; (P) 145.97; (R1) 146.53; More…

    Intraday bias in USD/JPY remains neutral and more consolidations could be seen below 148.64. . Further rally is expected as long as 144.02 resistance turned support holds. As noted before, fall from 158.86 could have completed 139.87 already. Above 148.64 will target 61.8% retracement of 158.86 to 139.87 at 151.60 next. However, firm break of 144.02 will bring retest of 139.87 low instead.

    In the bigger picture, price actions from 161.94 are seen as a corrective pattern to rise from 102.58 (2021 low), with fall from 158.86 as the third leg. Strong support should be seen from 38.2% retracement of 102.58 to 161.94 at 139.26 to bring rebound. However, sustained break of 139.26 would open up deeper medium term decline to 61.8% retracement at 125.25.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    22:30 NZD Business NZ PMI Apr 53.9 53.2
    23:50 JPY GDP Q/Q Q1 P -0.20% -0.10% 0.70%
    23:50 JPY GDP Deflator Y/Y Q1 P 3.30% 3.20% 2.90%
    03:00 NZD RBNZ Inflation Expectations Q2 2.29% 2.06%
    04:30 JPY Industrial Production M/M Mar F 0.20% -1.10% -1.10%
    09:00 EUR Eurozone Trade Balance (EUR) Mar 17.5B 21.0B
    12:30 USD Housing Starts Apr 1.37M 1.32M
    12:30 USD Building Permits Apr 1.45M 1.48M
    12:30 USD Import Price Index M/M Apr -0.40% -0.10%
    14:00 USD UoM Consumer Sentiment May P 53 52.2
    14:00 USD UoM Inflation Expectations May P 6.50%

     



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  • Gold price in Pakistan: Rates on May 16

    Gold price in Pakistan: Rates on May 16


    Gold prices fell in Pakistan on Friday, according to data compiled by FXStreet.

    The price for Gold stood at 29,134.04 Pakistani Rupees (PKR) per gram, down compared with the PKR 29,333.40 it cost on Thursday.

    The price for Gold decreased to PKR 339,813.20 per tola from PKR 342,139.00 per tola a day earlier.

    Unit measure Gold Price in PKR
    1 Gram 29,134.04
    10 Grams 291,339.90
    Tola 339,813.20
    Troy Ounce 906,170.60

     

    Daily Digest Market Movers: Gold price bulls refrain from placing aggressive bets amid trade optimism

    The US and China agreed to significantly lower tariffs and initiated a 90-day pause to finalize a broader deal, marking a de-escalation of a disruptive standoff between the world’s two largest economies. Moreover, US President Trump pointed to ongoing negotiations with India, Japan, and South Korea.

    Negotiators from Russia and Ukraine, as well as a delegation from the US, are currently in Istanbul, Turkey, for the first direct peace talks in three years. However, Russian President Vladimir Putin’s absence has already dashed hopes for any breakthrough toward ending the prolonged war.

    Meanwhile, Israel’s military intensifies its carnage across the Gaza Strip since dawn on Thursday, and the relentless assault, so far, has killed at least 143 Palestinians. This keeps geopolitical risks in play, which, along with the lack of any US Dollar buying interest, could support the safe-haven Gold price.

    A duo of weaker economic reports released from the US on Thursday reaffirmed market bets for more interest rate cuts by the Federal Reserve this year. This, in turn, dragged the US Treasury bond yields sharply lower and undermined the buck, lending some support to the non-yielding yellow metal.

    The US Producer Price Index for final demand fell 0.5% in April, marking the first monthly decline since 2023. This comes on top of softer US Consumer Price Index (CPI) on Tuesday, which rose at the lowest annual rate since February 2021, and further pointed to signs of easing inflationary pressures.

    Separately, the US Department of Commerce reported that Retail Sales rose 0.1% in April compared to the previous month’s upwardly revised growth of 1.7%. This increases the likelihood that the US economy will experience several quarters of sluggish growth and reaffirms dovish Fed expectations.

    FXStreet calculates Gold prices in Pakistan by adapting international prices (USD/PKR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.

     

    Gold FAQs

    Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

    Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

    Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

    The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

    (An automation tool was used in creating this post.)



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  • Markets Cautious Despite US-China Trade Progress, US Inflation and Consumer Data In Focus This Week

    Markets Cautious Despite US-China Trade Progress, US Inflation and Consumer Data In Focus This Week


    Markets opened the week on a subdued note despite the White House’s announcement that a trade agreement had been reached with China following negotiations in Switzerland. Despite the positive headline, investor reaction has been muted with lackluster performance in Asian stocks. Traders appear to be holding back judgment, at least until US Treasury Secretary Scott Bessent’s full briefing later in the day.

    In the currency markets, commodity currencies including Kiwi, Aussie and Loonie are outperforming slightly, supported by cautious optimism surrounding global trade. Meanwhile, traditional safe-haven currencies, Yen and Swiss Franc, are softening, along with Euro. Dollar and British Pound are trading mixed in the middle..

    This week brings a raft of high-profile US data, with particular attention on CPI, PPI, and retail sales. These releases will offer the first real look at how the sweeping April tariffs are affecting consumer prices and spending behavior.

    Technically, AUD/JPY is showing encouraging signs of strength as risk appetite improves. The rebound from the 86.03 low is resuming, with the pair now trading above 55 D EMA at 92.84. Sustained trading above this EMA will add to the case that correction from 109.36 (2024 high) has completed at 86.03. Next target will be 38.2% retracement of 109.36 to 86.03 at 94.94. However, break of 92.10 support will dampen this bullish view and mix up the outlook.

    In Asia, at the time of writing, Nikkei is up 0.05%. Hong Kong HSI is up 0.93%. China Shanghai SSE is up 0.37%. Singapore is on holiday. Japan 10-year JGB yield is up 0.039 at 1.393.

    Gold Falls as US-China Trade Deal Signals Easing Tensions

    Gold opened the week on the back foot as signs of further easing global trade tensions dented demand for safe-haven assets. The White House posted a surprise announcement of a trade agreement with China after weekend negotiations in Geneva. While no details were released immediately, both sides described the outcome as positive.

    US Treasury Secretary Scott Bessent called the talks a source of “substantial progress,” with a full briefing promised for Monday. US Trade Representative Jamieson Greer said the deal would help resolve the ongoing “national emergency” in trade. China’s Vice Premier He Lifeng confirmed both sides had reached “important consensus” and agreed to create a consultation mechanism for economic and trade issues.

    Markets appear to be cautiously optimistic that the US-China agreement marks a turning point in the broader trade conflict, at least in tone and intent. Investors are likely waiting for concrete details before reassessing the longer-term outlook, but for now, the improved risk sentiment is weighing on Gold’s short-term appeal.

    Technically, Gold’s extended decline suggests that rebound from 3201.70 has completed at 3434.76. Fall from there is now seen as the third leg of the corrective pattern from 3499.79 high. Deeper fall is in favor to 3201.70 support and possibly below. Still, down side should be contained by 38.2% retracement of 2584.24 to 3499.79 at 3150.04, which is close to 55 D EMA (now at 3144.42). Larger up trend is expected to resume after the correction completes.

    Bitcoin losing momentum after strong rally

    Bitcoin posted a strong rally last week, driven by a combination of improved global risk sentiment and sustained institutional demand through exchange-traded funds. A key driver has been BlackRock’s spot Bitcoin ETF, which extended its inflow streak to 19 consecutive trading days, its longest run of the year. These flows have provided strong tailwinds for Bitcoin, helping push prices closer to the 109,571 record high.

    However, signs are emerging that the rally may be losing steam, as seen in 4H MACD. A break below 102,291 support level would confirm short term topping, opening the door for a deeper pullback toward the 93,351 zone.

    The depth and structure of the correction, if realized, will be critical in assessing whether the advance from 74,373 low marks resumption of the long-term uptrend. Or it was merely the second leg in the medium term corrective pattern from the all-time high of 109,571.

     

    US data deluge to reveal first hints of tariff impacts

    This week will be packed with key economic data from the US, Japan, the UK and Australia. In particular for the US, tariffs impacts are beginning to filter through inflation and consumption indicators.

    The US April CPI and PPI reports will be the first meaningful look at how tariffs are affecting price levels. While it’s likely too early to see the full pass-through, any uptick in goods inflation could point to the initial impact of the 10–145% import duties imposed last month. In this round, annual readings will remain relevant, but month-on-month changes could carry more market impact at this early stage of the tariff cycle.

    Alongside inflation, April retail sales data will offer a clearer picture of how US consumers are reacting to any pricing shifts and the broader risk of higher costs on the horizon. The University of Michigan’s consumer sentiment survey, including its forward-looking inflation expectations component, will also provide key insight into how tariffs are feeding further into household psychology.

    In Japan, markets are increasingly convinced that BoJ will hold off on further tightening for longer, especially after it downgraded GDP forecasts. This week’s preliminary Q1 GDP data may confirm a contraction, reinforcing that view. Additionally, the BoJ’s Summary of Opinions from the latest policy meeting will give investors a sense of how concerned board members are about the rising risks from global trade disruptions and fragile domestic demand. A clear dovish tilt in the minutes could further weigh on Yen and push back rate hike expectations even further.

    From the UK, GDP and employment figures are due, but these are unlikely to shift the BoE from its current path of gradual easing—one 25bps cut per quarter—unless the data contains major surprises. Attention is likely to remain on the next phase of the recently announced US-UK trade agreement. With the framework now public, markets are looking for concrete details, timelines, and sector-specific implementations that could affect investment flows and business sentiment in the months ahead.

    Australia’s wage price index and job figures will also draw attention, though they are not expected to derail the current consensus for a rate cut from RBA later this month. Slowing growth, fading inflation momentum, and global uncertainty continue to dominate the domestic narrative.

    Here are some highlights for the week:

    • Monday: Japan current account; Eco Watcher sentiment.
    • Tuesday: BoJ Summary of Opinions; Australia Westpac consumer sentiment, NAB business confidence; UK employment; Germany ZEW economic sentiment; US CPI.
    • Wednesday: Japan PPI; Australia wage price index; Canada building permits.
    • Thursday: Australia employment; UK GDP, trade balance; Swiss PPI; Eurozone GDP revision, industrial production; Canada housing starts, manufacturing sales, wholesale sales; US retail sales, PPI, jobless claims, Empire State manufacturing, Philly Fed manufacturing, industrial production, business inventories, NAHB housing index.
    • Friday: New Zealand BNZ manufacturing, inflation expectations; Japan GDP; Eurozone trade balance; US building permits and housing starts, import prices, UoM consumer sentiment and inflation expectations.

    USD/CHF Daily Outlook

    Daily Pivots: (S1) 0.8192; (P) 0.8232; (R1) 0.8278; More….

    USD/CHF’s breach of 0.8333 suggests that rebound from 0.8038 is resuming. Intraday bias is back on the upside for 38.2% retracement of 0.9200 to 0.8038 at 0.8482. But strong resistance should be seen there to limit upside. On the downside, firm break of 0.8184 support will argue that the corrective rise has completed, and bring retest of 0.8038.

    In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress and met 61.8% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.8079 already. In any case, outlook will stay bearish as long as 55 W EMA (now at 0.8750) holds. Sustained break of 0.8079 will target 100% projection at 0.7382.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    23:50 JPY Bank Lending Y/Y Apr 2.40% 2.80% 2.80%
    23:50 JPY Current Account (JPY) Mar 2.72T 2.42T 2.32T 2.91T
    05:00 JPY Eco Watchers Survey: Current Apr 42.6 44.5 45.1

     



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  • Gold sticks to intraday losses; lacks follow-through amid geopolitical risks, ahead of FOMC

    Gold sticks to intraday losses; lacks follow-through amid geopolitical risks, ahead of FOMC


    • Gold price struggles to capitalize on its weekly gains registered over the past two days.
    • The optimism over US-China trade talks is seen weighing on the safe-haven commodity.
    • Investors now look to the crucial FOMC policy decision for a fresh directional impetus.

    Gold price (XAU/USD) recovers slightly from the Asian session low, around the $3,360 area, though maintains its offered tone amid the latest optimism over the announcement of the US-China trade talks in Switzerland this week. Apart from this, some repositioning trades ahead of the key central bank event risk assists the US Dollar (USD) to gain some positive traction, which is seen as another factor undermining the commodity.

    The USD bulls, however, seem reluctant to place aggressive bets and opt to wait for the outcome of the highly-anticipated two-day FOMC policy meeting. Furthermore, persistent geopolitical risks stemming from the protracted Russia-Ukraine war, conflicts in the Middle East, and a military escalation along the India-Pakistan border act as a tailwind for the safe-haven bullion. This, in turn, warrants some caution for the XAU/USD bears.

    Daily Digest Market Movers: Gold price bears seem non-committed amid geopolitical risks, ahead of FOMC decision

    • US Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer are set to meet their Chinese counterparts in Switzerland on Saturday to discuss trade and economic issues. This marks the first direct talks since the US imposed tariffs on China and a step toward resolving a trade war between the world’s two largest economies.
    • Meanwhile, US President Donald Trump said on Tuesday that he and top administration officials will review potential trade deals over the next two weeks to decide which ones to accept. This, however, counters Trump’s earlier statement that his administration could announce trade deals with some countries as soon as this week.
    • Furthermore, Trump had announced 100% tariffs on movies produced outside the US and also indicated that he plans to announce fresh tariffs on pharmaceutical imports over the next two weeks. This keeps investors on the edge and might continue to act as a tailwind for the safe-haven Gold price amid rising geopolitical risks.
    • A Kremlin spokesman says Russia will stick to its plans for a unilaterally-imposed ceasefire between 8 and 11 May but warned that an appropriate response will be given immediately if Ukraine does not also halt the fire. Meanwhile, Russia and Ukraine swapped 205 prisoners of war each in an exchange mediated by the United Arab Emirates.
    • Israel’s security Cabinet unanimously approved a plan to widen the military offensive in Gaza. The plan involves the Israel Defense Forces (IDF) invading and gradually seizing control of Gaza territory. Although no formal details were announced, officials said the operation would not begin until after Trump’s visit to the Middle East next week.
    • Investors keenly await the Federal Reserve’s decision later this Wednesday. The accompanying monetary policy statement and Fed Chair Jerome Powell’s comments at the post-meeting press conference will be scrutinized for cues about the future rate-cut path. This will drive the US Dollar demand and influence the non-yielding yellow metal.

    Gold price needs to break below the $3,360 area to support prospects for a further intraday depreciating move

    From a technical perspective, the overnight sustained breakout through the $3,360-3,365 horizontal barrier and a subsequent move beyond the $3,400 mark was seen as a fresh trigger for bulls. Moreover, oscillators on the daily chart are holding comfortably in positive territory, suggesting that the path of least resistance for the Gold price is to the upside. However, the strong uptrend witnessed since the beginning of this week falters near the $3,430-3,435 resistance. The said area should now act as a pivotal point, above which the XAU/USD could aim to challenge the all-time peak touched in April and conquer the $3,500 psychological mark.

    On the flip side, weakness below the $3,365-3,360 area could find some support near the $3,328-3,327 region ahead of the $3,300 round figure. Failure to defend the said support levels would negate the near-term positive outlook and make the Gold price vulnerable. The downward trajectory might then drag the XAU/USD pair to the $3,265-$3,260 intermediate support en route to the $3,223-3,222 region and the last week’s swing low, around the $3,200 neighborhood.

    US Dollar PRICE Today

    The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.

    USD EUR GBP JPY CAD AUD NZD CHF
    USD 0.12% 0.12% 0.52% 0.10% 0.16% 0.09% 0.35%
    EUR -0.12% 0.00% 0.42% -0.01% 0.05% -0.03% 0.24%
    GBP -0.12% -0.00% 0.42% -0.01% 0.05% -0.03% 0.24%
    JPY -0.52% -0.42% -0.42% -0.43% -0.37% -0.39% -0.15%
    CAD -0.10% 0.01% 0.00% 0.43% 0.07% -0.01% 0.25%
    AUD -0.16% -0.05% -0.05% 0.37% -0.07% -0.08% 0.17%
    NZD -0.09% 0.03% 0.03% 0.39% 0.01% 0.08% 0.27%
    CHF -0.35% -0.24% -0.24% 0.15% -0.25% -0.17% -0.27%

    The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).



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  • Dollar and Loonie Soft Ahead of Carney-Trump Meeting

    Dollar and Loonie Soft Ahead of Carney-Trump Meeting


    Dollar remains on the soft side today, although losses are so far limited. Currency market activity is subdued as traders remain cautious ahead of the upcoming FOMC rate decision. While no policy changes are expected from the Fed tomorrow, markets are watching closely for any forward guidance. Notably, expectations for a June rate cut have continued to fade, with implied probabilities falling below 30%, reflecting the resilience of recent economic data, particularly on jobs.

    However, the bigger driver of sentiment remains progress, or the lack thereof, on the trade front. Canadian Prime Minister Mark Carney is scheduled to meet President Donald Trump in Washington on Tuesday — the first face-to-face since Carney’s April 28 election victory. Trade and security are set to top the agenda. Canada is expected to bring proposals linked to energy and critical minerals, hoping to secure relief from US tariffs. Still, Carney has emphasized that substance will take precedence over speed.

    Meanwhile, US Treasury Secretary Scott Bessent hinted on Monday that deals with some trading partners were “very close,” echoing Trump’s remarks over the weekend. Yet no concrete agreements have been announced. A Bloomberg report suggested India is willing to offer zero tariffs on selected goods, but details remain sparse. Overall, market optimism over trade progress exists but is tempered by repeated delays and lack of formal announcements.

    So far this week, Dollar is the weakest performer, though still above last week’s lows. Loonie is also under pressure as markets await Carney’s Washington visit. Euro is lagging as well. Yen leads the gainers, followed by Kiwi and Swiss Franc. Sterling and Aussie are holding in the middle of the pack.

    Technically’s EUR/CAD’s decline from 1.5959 is currently seen as part of a corrective pattern to the rally from 1.4483. Deeper fall is expected as long as 1.5816 resistance holds, to 55 D EMA (now at 1.5505) and possibly below. But strong support should be seen from 1.5402 cluster support (38.2% retracement of 1.4483 to 1.5959 at 1.5395) to contain downside.

    In Asia, Japan is still on holiday, Hong Kong HSI is up 0.62%. China Shanghai SSE is up 0.93%. Singapore Strait Times is up 0.20%. Overnight, DOW fell -0.24%. S&P 500 fell -0.64%. NASDAQ fell -0.74%. 10-year yield rose 0.021 to 4.343.

    Looking ahead, Swiss unemployment rate, France industrial production, Eurozone PMI services final and PPI, and UK PMI services final will be released in European session. Later in the day, Canada and US will publish trade balance.

    Gold breaks higher, eyes on 3500 and beyond

    Gold’s extended rebound and break of 3352.97 resistance argues that correction from 3449.79 has already completed at 3201.70. Further rise is now expected to 3499.79 and then 61.8% projection of 2956.61 to 3449.70 from 3201.70 at 3537.38. Decisive break of 3537.38 could prompt upside acceleration towards 100% projection at 3744.88. However, break of 55 4H EMA (now at 3287.46) will resume the corrective fall from 3499.79 with another downleg.

    In the bigger picture, the long term up trend remains intact and there is no sign of loss of momentum in W MACD, despite overbought condition in W RSI. Next medium term target remains at 261.8% projection of 1160.17 to 2074.84 from 1614.60 at 4009.20, which is close to 4000 psychological level.

    China’s Caixin PMI composite falls to 51.1, tariff impact to deepen in Q2–Q3

    China’s Caixin PMI Services dropped to 50.7 in April, down from 51.9 and missing expectations of 51.7. PMI Composite also slipped from 51.8 to 51.1, signaling weaker momentum across both manufacturing and services.

    According to Caixin’s Wang Zhe, the expansion in supply and demand has decelerated amid growing trade friction. Export-driven sectors remain under particular pressure, while job losses and muted pricing power continue to squeeze business margins. The employment component of the composite index also contracted.

    Perhaps most concerning, expectations for future activity plunged to the lowest levels on record, reflecting rising uncertainty among firms. “The ripple effects of the ongoing China-US tariff standoff will gradually be felt in the second and third quarter”, Wang added.

    USD/CHF Daily Outlook

    Daily Pivots: (S1) 0.8200; (P) 0.8237; (R1) 0.8261; More….

    USD/CHF is still bounded in range below 0.8333 and intraday bias stays neutral at this point. On the upside, above 0.8333 will resume the rebound from 0.8038. However, upside should be limited by 38.2% retracement of 0.9200 to 0.8038 at 0.8482. On the downside, below 0.8196 minor support will bring retest of 0.8038. Firm break there will resume larger down trend.

    In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress and met 61.8% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.8079 already. In any case, outlook will stay bearish as long as 55 W EMA (now at 0.8763) holds. Sustained break of 0.8079 will target 100% projection at 0.7382.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    01:30 AUD Building Permits M/M Mar -8.80% -1.70% -0.30% -0.20%
    01:45 CNY Caixin Services PMI Apr 50.7 51.7 51.9
    06:45 EUR France Industrial Output M/M Mar 0.40% 0.70%
    07:50 EUR France Services PMI Apr F 46.8 46.8
    07:55 EUR Germany Services PMI Apr F 48.8 48.8
    08:00 EUR Eurozone Services PMI Apr F 49.7 49.7
    08:30 GBP Services PMI Apr F 48.9 48.9
    09:00 EUR Eurozone PPI M/M Mar -1.10% 0.20%
    09:00 EUR Eurozone PPI Y/Y Mar 2% 3%
    12:30 CAD Trade Balance (CAD) Mar -1.7B -1.5B
    12:30 USD Trade Balance (USD) Mar -124.7B -122.7B
    14:00 CAD Ivey PMI Apr 51.2 51.3

     



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  • Muted Major FX Action Masks Big Moves in Asia; Gold Rebound Gather Momentum

    Muted Major FX Action Masks Big Moves in Asia; Gold Rebound Gather Momentum


    The currency markets remain subdued in early trading this week, with the exception of a broad, mild Dollar weakness. Among the major currencies, movements have been muted despite notable developments. Swiss inflation falling back to 0% has increased pressure on the SNB to cut rates further to avoid deflation, but the Swiss Franc showed little response. Similarly, an unexpected improvement in Eurozone investor confidence failed to generate any sustained lift in the Euro.

    In equities, European stocks were mixed, lacking clear conviction, while UK markets closed for a public holiday. US futures also point to a slightly weaker open. Meanwhile, oil prices saw some stabilization but remained lower for the day after OPEC+ agreed to a production hike over the weekend. WTI crude is attempting to recover, but the bearish bias remains as markets now anticipate a potential production surplus in the second half of the year.

    The most eye-catching action is unfolding in Asian currency markets. Taiwanese Dollar soared more than 5% to a three-year high against Dollar, capping an 8% gain in just two sessions. The sharp move followed the conclusion of US-Taiwan trade talks last week, stoking speculation that a tacit agreement to strengthen the TWD may have been reached. While it’s denied by Taiwan’s central bank, the pace and scale of the rally suggest market confidence in a policy-backed shift, which would align with US interests in reducing bilateral trade imbalances.

    China’s offshore yuan also rallied sharply, touching a six-month high against the greenback. While no official catalyst was pinpointed, the move followed speculation that the US and China may soon begin tariff negotiations. However, any such discussions would be complex and drawn-out, likely injecting fresh volatility into CNY markets.

    Technically, one focus now is on how far Gold’s rebound could go. Firm break of 3352.97 resistance will indicate that correction from 3499.79 has already completed at 3201.70, ahead of 3167.62 resistance turned support. Retest of 3499.79 should be seen next, with prospect of breaking through this level to resume the record run.

    Eurozone Sentix confidence surges to -8.1 as investors cheer calm EU response to trade war

    Eurozone Sentix Investor Confidence rose sharply from -19.5 to -8.1,well above expectations. Current Situation Index climbed from -23.3 to -19.3, the highest level since August 2024. Expectations Index turned positive, rising from -15.8 to 3.8.

    Sentix credited the European Commission’s “level-headed response” toward escalating US trade actions for the improving sentiment. Additionally, a surprising improvement in inflation data has reinforced expectations that ECB will be able to continue its gradual rate-cutting cycle.

    While investors are clearly more upbeat, Sentix noted the mood was “more subdued but basically ‘calm’”, comparing to March.

    ECB’s Panetta warns protectionism threatens global prosperity

    Italian ECB Governing Council member Fabio Panetta warned today that rising protectionism poses a serious threat to global economic stability

    Speaking at an event, Panetta said, “Openness to trade has benefited both advanced and developing nations, reducing inequality and lifting hundreds of millions of people out of extreme poverty.”

    However, “protectionism threatens to undo these achievements and to weaken the very fabric of global prosperity,” he added.

    He emphasized that geopolitical tensions, alongside growing uncertainty in global trade, are becoming central considerations for policymakers.

    Swiss CPI drops to 0% as import deflation worsens

    Swiss consumer price growth came to a standstill in April, with headline CPI unchanged month-on-month for a second consecutive month.

    On an annual basis, inflation slowed sharply from 0.3% yoy to 0.0% yoy, marking a return to flat price levels not seen since the disinflationary spell of early 2021.

    Core CPI (excluding fresh and seasonal products, energy and fuel) also lost momentum, easing from 0.9% yoy to 0.6% yoy.

    The softness in inflation was driven by a decline in domestic product prices, which fell -0.1% mom and decelerated from 1.0% yoy to 0.8% yoy. Meanwhile, imported product prices offered a small offset, rising 0.3% mom but still contracting -2.5% yoy (prior -1.7% yoy).

    EUR/USD Mid-Day Outlook

    Daily Pivots: (S1) 1.1257; (P) 1.1319; (R1) 1.1364; More…

    EUR/USD is staying in tight range above 1.1265 and intraday bias remains neutral. On the downside, below 1.1265 will resume the corrective fall from 1.1572 short term top. But downside should be contained by 38.2% retracement of 1.0176 to 1.1572 at 1.1039. On the upside, break of 1.1424 will suggest that the correction has completed and bring retest of 1.1572 high.

    In the bigger picture, rise from 0.9534 long term bottom could be correcting the multi-decade downtrend or the start of a long term up trend. In either case, further rise should be seen to 100% projection of 0.9534 to 1.1274 from 1.0176 at 1.1916. This will now remain the favored case as long as 55 W EMA (now at 1.0808) holds.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    01:00 AUD TD-MI Inflation Gauge M/M Apr 0.60% 0.70%
    06:30 CHF CPI M/M Apr 0.00% 0.20% 0.00%
    06:30 CHF CPI Y/Y Apr 0.00% 0.30%
    08:30 EUR Eurozone Sentix Investor Confidence May -8.1 -14.9 -19.5
    13:45 USD Services PMI Apr F 51.4 51.4
    14:00 USD ISM Services PMI Apr 50.6 50.8

     



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  • Gold price gains as Greenback loses popularity as safe haven

    Gold price gains as Greenback loses popularity as safe haven


    • Gold price rallies more than 2% on Monday with nervousness towards the Fed interest-rate decision. 
    • Geopolitical risks coming from Trump and Israel are pushing investors back into Gold.
    • The Greenback is losing its status as safe haven in favor of Bullion.

    Gold (XAU/USD) rises by more than 2% on Monday to $3,317 at the time of writing, as geopolitical risk surges. The Houthi attack that hit Ben Gurion airport this weekend and Israel’s promise to retaliate while preparing for a broad ground offensive in Gaza are elevating risks again in the region. Meanwhile, US President Donald Trump said that military action might be an option to consider for the US to seize control of Greenland. 

    Gold’s appeal increases as traders brace for the Federal Reserve’s rate decision on May 7. Over the weekend, Trump expressed his dislike again of the Fed and its Chairman Jerome Powell. After calling Powell “stiff”, the US President called upon the Federal Open Market Committee (FOMC) members to pressure Chairman Powell to deliver rate cuts. 

    According to the Chicago Mercantile Exchange (CME) Fedwatch tool, no rate cut is foreseen for this Wednesday. Given the recent Nonfarm Payrolls print and the latest string of data from sectors such as Manufacturing and Services, the US economy is starting to ease, but is not crashing. This could be ammunition for Fed Chairman Powell to push against the political pressure and channel to markets that rates will stay steady for longer until the Fed is comfortable enough to lower them.. 

    Daily digest market movers: Taiwan mayhem

    • Several Asian markets are closed for a public holiday on Monday. The United Kingdom is closed as well. 
    • The Taiwan Dollar (TWD) gained as much as 5% at one point over the US Dollar (USD). The move came after local exporters started selling their Dollar holdings after the Taiwan central bank on Friday issued a late statement asking exporters not to do so. Several traders are pointing out as well that in the tariff discussions between Taiwan and the Trump administration, the demand to strengthen the Taiwan Dollar is one of the elements to avoid further tariff implications for the Taiwan economy, Bloomberg reports.
    • In the Gold mining sector, some takeover news with Gold Road Resources agreeing to be bought for $3.7 billion after South African suitor Gold Fields sweetened its offer, concluding a public spat between the joint venture partners, Financial Review reports. 
    • The CME FedWatch tool shows the chance of an interest rate cut by the Federal Reserve in May’s meeting stands at 5.2% against a 94.6% probability of no change. The June meeting sees a 46.6% chance of a rate cut.

    Gold Price Technical Analysis: Elastic band ready to slingshot higher

    Bullion is sprinting higher on Monday, while the Greenback dipped lower at the start of the trading day. The communication vessels synergy between the two assets comes just a few days ahead of the Fed rate decision. Generally, steady or higher rates are bad for Gold as the returns from interests in bonds are more attractive than the return from Gold. However, there might be a breakout in that narrative: if rates remain elevated at current levels, the US economy could weaken further, contract and trigger stagflation or recession, and Gold is a better positioned hedge to withstand that scenario. 

    On the upside, the R1 resistance at $3,265 has already been broken in a topside test in early trading this Monday. Should some follow-through come, the R2 at $3,337 might be a bit too far off. Rather look for $3,290 (May 1 high) and $3,320 (April 30 high) as intermediary levels nearby for upside resistance. 

    On the downside, pivot at $3,244 together with the technical level at $3,245 should do the trick and hold. In case Bullion dips further, very close supports are present near $3,219 S1 intraday support and $3,197 S2 intraday support for Monday. 

    XAU/USD: Daily Chart

    Central banks FAQs

    Central Banks have a key mandate which is making sure that there is price stability in a country or region. Economies are constantly facing inflation or deflation when prices for certain goods and services are fluctuating. Constant rising prices for the same goods means inflation, constant lowered prices for the same goods means deflation. It is the task of the central bank to keep the demand in line by tweaking its policy rate. For the biggest central banks like the US Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BoE), the mandate is to keep inflation close to 2%.

    A central bank has one important tool at its disposal to get inflation higher or lower, and that is by tweaking its benchmark policy rate, commonly known as interest rate. On pre-communicated moments, the central bank will issue a statement with its policy rate and provide additional reasoning on why it is either remaining or changing (cutting or hiking) it. Local banks will adjust their savings and lending rates accordingly, which in turn will make it either harder or easier for people to earn on their savings or for companies to take out loans and make investments in their businesses. When the central bank hikes interest rates substantially, this is called monetary tightening. When it is cutting its benchmark rate, it is called monetary easing.

    A central bank is often politically independent. Members of the central bank policy board are passing through a series of panels and hearings before being appointed to a policy board seat. Each member in that board often has a certain conviction on how the central bank should control inflation and the subsequent monetary policy. Members that want a very loose monetary policy, with low rates and cheap lending, to boost the economy substantially while being content to see inflation slightly above 2%, are called ‘doves’. Members that rather want to see higher rates to reward savings and want to keep a lit on inflation at all time are called ‘hawks’ and will not rest until inflation is at or just below 2%.

    Normally, there is a chairman or president who leads each meeting, needs to create a consensus between the hawks or doves and has his or her final say when it would come down to a vote split to avoid a 50-50 tie on whether the current policy should be adjusted. The chairman will deliver speeches which often can be followed live, where the current monetary stance and outlook is being communicated. A central bank will try to push forward its monetary policy without triggering violent swings in rates, equities, or its currency. All members of the central bank will channel their stance toward the markets in advance of a policy meeting event. A few days before a policy meeting takes place until the new policy has been communicated, members are forbidden to talk publicly. This is called the blackout period.



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  • FX Markets Hold Range While Yen Extends Slide

    FX Markets Hold Range While Yen Extends Slide


    Yen weakness remains the dominant theme in an otherwise range-bound forex market today. While all other major pairs and crosses are contained within yesterday’s trading range, the Japanese currency continues to lose ground as traders react to BoJ’s dovish tone. Governor Kazuo Ueda attempted to soften the impact of the downgraded growth outlook and emphasized that a delay in inflation convergence wouldn’t necessarily mean a delay in rate hikes.

    However, markets took greater note of his admission that the baseline scenario for Japan’s economy “no longer has very high probability,” a statement that effectively resets expectations for near-term tightening. The prospect of a move in June has effectively diminished, and the odds for a Q3 hike now hinge heavily on how trade negotiations evolve between the US and its key partners, including Japan.

    In the US, equity market sentiment is buoyant today as strong earnings from tech giants Meta Platforms and Microsoft lifted futures. Initial jobless claims rose more than expected, but the data has been largely brushed aside for now. Markets are instead turning attention to the upcoming ISM manufacturing report, which will offer more timely insights into how business activity and pricing dynamics are responding to the trade policy shockwaves. Still, the real litmus test for broader sentiment will be Friday’s non-farm payrolls release.

    On the week, Kiwi leads losses for now, followed by Yen and Euro. Loonie outperforms, along with Sterling and Swiss Franc. Dollar and Aussie are treading water in the middle of the pack.

    Technically. Gold’s correction from 3499.79 extended lower today. Deeper fall might be seen, but downside should be contained by 3167.62 resistance turned support, which is close to 38.2% retracement of 2584.24 to 3499.79 at 3150.04. Break of 3352.92 resistance will bring retest of 3499.79 high.

    In Europe, at the time of writing, FTSE is down -0.13%. UK 10-year yield is down -0.01 at 4.436. Germany and France are on holiday. Earlier in Asia, Nikkei rose 1.13%. Japan 10-year JGB yield fell -0.04 to 1.275. Hong Kong, China, and Singapore were on holiday.

    US initial jobless claims rise to 241k vs exp 221k

    US initial jobless claims rose 18k to 241k in the week ending April 26, above expectation of 221k. Four-week moving average of initial claims rose 5.5k to 226k.

    Continuing claims rose 83k to 1916k in the week ending April 19, highest since November 13, 2021. Four-week moving average of continuing claims rose 6k to 1868k.

    UK PMI manufacturing finalized at 45.4, rising costs, declining demand

    UK manufacturing continued to contract in April, with PMI finalized at 45.4, a modest rise from March’s 44.9.

    The sector is facing mounting challenges as output, new orders, and exports all declined further. Business confidence also fell to its lowest level since late 2022, reflecting growing unease over global trade disruptions and rising input costs.

    S&P Global’s Rob Dobson highlighted a nearly five-year record drop in new export orders, particularly from the US, Europe, and China.

    Manufacturers are also being squeezed by a surge in purchase price inflation, now at a 28-month high. This is prompting firms to raise prices and cut discretionary spending, reinforcing a troubling mix of “rising costs, declining demand”.

    BoJ holds rates, slashes growth outlook on trade headwinds

    BoJ kept its benchmark interest rate unchanged at 0.50% today, by unanimous vote, in line with expectations. However, it struck a cautious tone on the economic outlook by sharply cutting its growth forecasts.

    The central bank now projects Japan’s real GDP to grow just 0.5% in fiscal 2025, down from the 1.1% forecast in January, and 0.7% in fiscal 2026 (downgraded from 1.0%). Growth is expected to recover to 1.0% in fiscal 2027, assuming stabilization in global conditions.

    In its statement, BoJ acknowledged that “Japan’s economic growth is likely to moderate” as global trade and policy uncertainty weigh on external demand and corporate profitability. Still, the bank expects activity to reaccelerate once overseas economies resume “a moderate growth path.”

    On inflation, BoJ maintained that price pressures are broadly on course toward the 2% target, but revised its CPI core forecast down from 2.4% to 2.2% for fiscal 2025, and from 2.0% to 1.7% for fiscal 2026.

    BoJ raised its projection for the core-core CPI from 2.1% to 2.3% for fiscal 2025, reflecting persistent domestic inflation pressures. However, this is followed by a downgrade from 2.1% to 1.8% in 2026 before stabilizing at 2.0% in 2027.

    BoJ’s Ueda: Inflation target delay won’t necessarily postpone rate hikes

    At the post meeting press conference, BoJ Kazuo Ueda acknowledged that the surge in global trade tensions, sparked by the US’s “reciprocal” tariffs, has sharply elevated uncertainty over global policy direction. He warned that these tariff shocks would “weigh on” on Japan’s growth and inflation in the near term, but expressed hope that such effects would fade as overseas economies stabilize.

    Ueda noted that BoJ downgraded its growth outlook for fiscal 2025 and 2026, with both inflation and wage gains expected to “likely slow somewhat. However, he maintained that Japan’s “severe labour shortage” should keep the positive wage-inflation cycle intact over the medium term.

    Despite pushing back the timeline for inflation to converge with the 2% target, Ueda stressed “that doesn’t mean the timing of further rate hikes will automatically be delayed by the same margin.”

    Ueda emphasized that BoJ’s forecasts hinge on the assumption that trade negotiations will progress and avoid serious supply chain disruptions. However, he admitted that the probability of the baseline scenario being realized “is no longer very high.” Further tariff escalation could alter both the economic outlook and BoJ’s future policy stance.

    Japan’s PMI manufacturing finalized at 48.7, slump persists amid trade uncertainty

    Japan’s manufacturing sector remained in contractionary territory in April, with the final PMI reading at 48.7, up slightly from March’s 48.4. While the deterioration in business conditions marked the tenth consecutive month of decline, it remained modest.

    However, underlying components revealed more concerning trends, with sharper drops in new orders and exports, highlighting persistent demand-side weakness.

    According to S&P Global, firms responded by scaling back purchasing and adjusting inventories, while overall sentiment worsened.

    Business confidence around future output fell to its lowest since mid-2020, as companies expressed caution amid ongoing global trade tensions and muted demand. Without a significant turnaround in both domestic and external demand, “firms are likely to struggle to see a recovery in conditions”.

    USD/JPY Mid-Day Outlook

    Daily Pivots: (S1) 142.42; (P) 142.81; (R1) 143.45; More…

    Intraday bias in USD/JPY remains on the upside for the moment. Rebound from 139.87 should target 100% projection of 139.87 to 144.02 from 141.96 at 146.11. But still, near term outlook will stay bearish as long as 38.2% retracement of 158.86 to 139.87 at 147.12 holds. On the downside, firm break of 141.96 will argue that the rebound has completed as a corrective move. Retest of 139.87 should then be seen next in this case.

    In the bigger picture, price actions from 161.94 are seen as a corrective pattern to rise from 102.58 (2021 low), with fall from 158.86 as the third leg. Strong support should be seen from 38.2% retracement of 102.58 to 161.94 at 139.26 to bring rebound. However, sustained break of 139.26 would open up deeper medium term decline to 61.8% retracement at 125.25.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    00:30 JPY Manufacturing PMI Apr F 48.7 48.5 48.5
    01:30 AUD Import Price Index Q/Q Q1 3.30% 0.30% 0.20%
    01:30 AUD Trade Balance (AUD) Mar 6.90B 3.10B 2.97B 2.85B
    03:03 JPY BoJ Interest Rate Decision 0.50% 0.50% 0.50%
    05:00 JPY Consumer Confidence Index Apr 31.2 34 34.1
    06:30 CHF Real Retail Sales Y/Y Mar 2.20% 1.90% 1.60% 1.20%
    08:30 GBP M4 Money Supply M/M Mar 0.30% 0.20% 0.20%
    08:30 GBP Mortgage Approvals Mar 64K 65K 65K
    08:30 GBP Manufacturing PMI Apr F 45.4 44 44
    11:30 USD Challenger Job Cuts Y/Y Apr 62.70% 204.80%
    12:30 USD Initial Jobless Claims (Apr 25) 241K 221K 222K 223K
    13:30 CAD Manufacturing PMI Apr 46.3
    13:45 USD Manufacturing PMI Apr F 50.7 50.7
    14:00 USD ISM Manufacturing PMI Apr 47.9 49
    14:00 USD ISM Manufacturing Prices Paid Apr 70.2 69.4
    14:00 USD ISM Manufacturing Employment Apr 44.7
    14:00 USD Construction Spending M/M Mar 0.30% 0.70%
    14:30 USD Natural Gas Storage 111B 88B

     



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  • Gold price in Pakistan: Rates on May 16

    Gold price climbs past $3,300 on uncertainty about trade and weak USD


    • Gold snaps two-day losing streak, gaining 1.5% on fresh trade war fears.
    • Trump softens tariff talk, but China denies negotiations and demands full rollback.
    • Fed rate cut bets rise as yields drop and economic uncertainty builds.

    Gold price snapped two days of losses on Thursday and rose $50, or more than 1.50%, amid renewed concerns about the US-China trade war. Even though US President Donald Trump softened his stance on sticking to 145% tariffs on Beijing, the XAU/USD trades at $3,338 after jumping off daily lows of $3,287.

    Market mood remains upbeat with Wall Street posting gains. Although traders seem relieved by Trump’s willingness to reach a deal with Beijing, China plays hardball and asks to cancel all “unilateral” US tariffs, clarifying that they have not held talks with the US government.

    Bullion prices advance underpinned by the plunge in US Treasury bond yields. The US Dollar Index (DXY) is also feeling the pain after hitting four-day peaks against a basket of six currencies.

    US economic data witnessed the release of Initial Jobless Claims for the last week, which was aligned with estimates. Durable Goods Orders jumped sharply in March, sponsored by airplane orders.

    Meanwhile, a wave of Federal Reserve (Fed) officials grabbed the headlines. Cleveland Fed President Beth Hammack stated the Fed could act as soon as June if the data supports it but emphasized that uncertainty is weighing on business planning.

    Fed Governor Christopher Waller echoed a similar tone, noting that while action in June remains on the table, rate cuts may be driven by a weakening labor market. Waller said, “rate cuts could come from rising unemployment.”

    Regarding the chances of the Fed reducing interest rates at the upcoming meeting, traders see a 94% chance of keeping them unchanged, according to Prime Market Terminal. Nevertheless, traders expect the Fed funds rate to end at 3.45%, equal to 86 basis points of easing (bps).

    Source: Prime Market Terminal

    Daily digest market movers: Gold price climbs boosted by weak US Dollar

    • The yield on the US 10-year Treasury note has decreased by seven-and-a-half basis points, reaching 4.31%.
    • US real yields collapsed seven bps to 2.023%, as shown by the US 10-year Treasury Inflation-Protected Securities yields.
    • US Durable Goods Orders soared in March from 0.9% to 9.2%, sponsored by aircraft bookings. Initial Jobless Claims for the week ending April 19 rose by 222K as expected, up from 216K in the previous reading.

    XAU/USD technical outlook: Gold price uptrend resumes as buyers reclaim $3,300

    The Gold price uptrend resumed, yet buyers must clear the April 22 high of $3,386 to prevent sellers from dragging lower prices. The next key resistance level would be $3,400, followed by the $3,450 and the $3,500 figure.

    On the other hand, if XAU/USD tumbles below $3,300, this could open the door to test $3,200 ahead of the April 3 peak of $3,167. A breach of the latter will expose the 50-day Simple Moving Average (SMA) at $3,041.

    US-China Trade War FAQs

    Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living.

    An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies.

    The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.



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  • Markets Pause After Relief Rally, Bessent Tempers De-escalation Optimism

    Markets Pause After Relief Rally, Bessent Tempers De-escalation Optimism


    Markets are treading water in the Asian session today, with most asset classes trading mixed and within familiar ranges. While US equities closed higher overnight, much of the early gains were pared back, signaling the fragility of the current risk-on mood. The price action reflects what is often seen during a relief rally—short-lived optimism that fades quickly if underlying uncertainty persists. Hopes of a breakthrough in US-China tariff talks briefly lifted sentiment, but optimism quickly met a dose of reality from Washington.

    US Treasury Secretary Scott Bessent pushed back against speculation that President Donald Trump had offered any unilateral gesture to ease tariffs on China. “No unilateral offer—none at all,” Bessent clarified. He acknowledged that current tariff levels are likely unsustainable but stressed that any reduction would have to be mutual. His remarks serve as a reminder that structural obstacles in the trade negotiations remain and that headline-driven rallies may lack staying power.

    In the currency markets, price actions are subdued, with all major pairs and crosses trading within yesterday’s ranges. Kiwi is leading gains for the week so far, followed by Dollar and Loonie. On the other side, the safe-haven trio in on the back foot, with Swiss Franc, Yen, and Euro the weakest performers, in line with stabilizing risk sentiment and a broader unwinding of prior defensive flows. Sterling and Aussie are middling.

    Technically, Gold’s breach of 3283.69 minor support indicates short term topping at 3499.79, just ahead of 3500 psychological level. Some consolidations should be seen in the near term, with risk of deeper pullback. But downside should be contained by 3167.62 cluster support (38.2% retracement of 2584.24 to 3499.79 at 3150.04 to bring rebound. Gold’s long term up trend is expected to continue after the consolidation completes.

    In Asia, at the time of writing, Nikkei is up 0.40%. Hong Kong HSI is down -1.08%. China Shanghai SSE is up 0.06%. Singapore Strait Times is up 0.26%. Japan 10-year JGB yield is up 0.001 at 1.325. Overnight, DOW rose 1.07%. S&P 500 rose 1.67%. NASDAQ rose 2.50%. 10-year yield fell -0.02 to 4.387.

    Looking ahead, German Ifo business climate is the main feature in European session. Later in the day, US will release jobless claims, durable goods orders, and existing home sales.

    IMF: BoJ may delay rate hike on tariff risk, cacks Yen’s haven role

    Nada Choueiri, deputy director of IMF’s Asia Pacific Department, told Reuters that BoJ is likely to delay further interest rate hikes as heightened uncertainty from US tariff policy weighs on business sentiment and economic outlook.

    She noted that many Japanese firms are now hesitant to move forward with investment plans, opting instead to wait for greater clarity on global trade developments. “This is postponing investment decisions as well,” Choueiri said, adding that the downside risks to both growth and inflation have increased.

    “We do see that if our reference scenario materializes, the BOJ interest rate increases will be pushed backwards in time,” she said.

    Choueiri also commented on the recent appreciation of Yen, reaffirming its role as a “safe-haven currency”, supported by the country’s economic stability and predictability.

    Fed’s Beige Book: Stagnant growth, tariff-driven inflation

    The latest Fed Beige Book painted a picture of a stagnating US economy, with activity described as “little changed” across most of the country. Of the 12 Districts, only five reported slight growth, while three saw flat conditions and the remaining four noted modest declines.

    However, the most striking theme running through the report was the “pervasive” uncertainty around international trade policy, which was highlighted in nearly all Districts as a key concern weighing on sentiment and business planning.

    Inflation pressures remain persistent, with half of the Districts describing price growth as moderate and the other half calling it modest. However, many businesses signaled “elevated input cost growth” tied to tariffs, with some already receiving notices from suppliers warning of upcoming price hikes.

    In response, firms have started add “tariff surcharge” or shortening their pricing terms. Still, the ability to fully pass on higher costs is proving difficult in some sectors, particularly for consumer-facing sectors where demand remains sluggish.

    ECB’s Lane sees Dollar outflows as rebalancing, not the end of dominance

    Speaking at an IIF conference overnight, ECB Chief Economist Philip Lane downplayed concerns over recent portfolio shifts away from US Dollar assets, suggesting the move may reflect a normalization rather than a structural retreat.

    Lane noted that allocations are likely moving from an overweight position in Dollar-denominated assets toward a more balanced distribution among global currencies.

    He pointed out that US assets had been “priced to perfection” following US President Donald Trump’s election last year, making some degree of reallocation expected as valuations adjust.

    Lane also addressed recent outflows from U.S. Treasuries, framing them as part of this rebalancing process. “It can either settle down or invite a deeper rethink,” he said, leaving the door open to further shifts depending on global investor sentiment.

    However, he admitted that despite the near-term adjustments, Dollar is still expected to far outweigh Euro in most global portfolios.

    ECB’s Knot and Muller downplay tariff impacts on inflation and growth

    Dutch ECB Governing Council member Klaas Knot noted that the combination of US tariffs, a stronger Euro, and falling energy prices could push eurozone inflation lower than expected in the short term.

    “The strong euro, together with falling energy prices, suggests that the near-term impact might not be so inflationary after all,” Knot said. However, he cautioned that medium-term risks remain, especially if global supply chain disruptions intensify. He supported keeping the ECB’s key policy rate within a neutral range of 1.75% to 2.25%, where it currently stands.

    Echoing a cautious but measured tone, Estonia’s ECB Governing Council member Madis Muller acknowledged that the US’s evolving trade policy creates “quite a bit more challenging” outlook for the Eurozone. Nevertheless, he maintained that moderate growth remains achievable, albeit at a slower pace than previously anticipated.

    Muller added that he is not forecasting a recession, noting that the impact of trade tensions, while significant, is unlikely to derail the region’s economic recovery entirely. Though, he emphasized the need for optionality, suggesting that more accommodation could be warranted if conditions deteriorate

    BoE’s Bailey: We must take tariff-related growth risks very seriously

    BoE Governor Andrew Bailey emphasized the growing downside risks to UK growth stemming from US President Donald Trump’s tariff policies. Speaking at an IIF conference, Bailey said, “We do have to take very seriously the risk to growth,” highlighting the UK’s vulnerability as a highly open economy.

    He noted that the impact of U.S. trade measures extends far beyond bilateral ties, influencing the UK through broader disruptions in global trade dynamics.

    When asked how much the BoE is factoring in the effects of US trade policy, Bailey confirmed that the issue is front and center. “We’re currently working through that because we’ve got an interest rate decision coming in two weeks’ time,” he said.

    USD/CAD Daily Outlook

    Daily Pivots: (S1) 1.3818; (P) 1.3861; (R1) 1.3925; More…

    A short term bottom should be in place at 1.3780, just ahead of 100% projection of 1.4791 to 1.4150 from 1.4414 at 1.3773, and on bullish convergence condition in 4H MACD. Intraday bias in USD/CAD is mildly on the upside for recovery. But upside should be limited by 1.4150 support turned resistance (38.2% retracement of 1.4791 to 1.3780 at 1.4166. On the downside, firm break of 1.3780 will resume the whole fall from 1.4791.

    In the bigger picture, the break of 1.3976 resistance turned support (2022 high) and 55 W EMA (now at 1.3982) indicates that a medium term top is already in place at 1.4791. Fall from there would either be a correction to rise from 1.2005, or trend reversal. In either case, firm break of 38.2% retracement of 1.2005 (2021 low) to 1.4791 at 1.3727 will pave the way back to 61.8% retracement at 1.3069.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    23:50 JPY Corporate Service Price Index Y/Y Mar 3.10% 3% 3% 3.20%
    08:00 EUR Germany IFO Business Climate Apr 85.2 86.7
    08:00 EUR Germany IFO Current Assessment Apr 85.5 85.7
    08:00 EUR Germany IFO Expectations Apr 85 87.7
    12:30 USD Initial Jobless Claims (Apr 18) 222K 215K
    12:30 USD Durable Goods Orders Mar 1.50% 1.00%
    12:30 USD Durable Goods Orders ex-Trans Mar 0.20% 0.70%
    14:00 USD Existing Home Sales Mar 4.14M 4.26M
    14:30 USD Natural Gas Storage 69B 16B

     



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  • Gold shows signs of bullish exhaustion amid positive turnaround in risk sentiment

    Gold shows signs of bullish exhaustion amid positive turnaround in risk sentiment


    • Gold price rebounds from the Asian session trough as the USD stalls its recovery from a multi-year low.
    • The weakening investors’ confidence in the US economy and Fed rate cut bets weigh on the Greenback.
    • The optimism over easing US-China tensions remains supportive of the risk-on impulse and caps the XAU/USD pair.

    Gold price (XAU/USD) attracted dip-buyers in Asia on Wednesday, stalling its retreat from the $3,500 peak hit the day before. The attempted US Dollar (USD) recovery from a multi-year low faltered amid the weakening confidence in the US economy on the back of US President Donald Trump’s back-and-forth tariff announcements. Apart from this, the prospects for more aggressive policy easing by the Federal Reserve (Fed) prompt some intraday USD selling and turn out to be a key factor that helps revive demand for the non-yielding yellow metal.

    Meanwhile, Trump administration officials hinted at a potential de-escalation of the ongoing tariff dispute with China and fueled optimism about a trade deal. Adding to this Trump stepped back from his threats to dismiss Federal Reserve (Fed) Chair Jerome Powell. Furthermore, Russian President Vladimir Putin indicated he is open to the prospect of direct talks with his Ukrainian counterpart Volodymyr Zelenskyy, raising hopes for a ceasefire and further boosting investors’ appetite for riskier assets. This is evident from a sharp recovery across the global equity markets, which, in turn, is holding back traders from placing fresh bullish bets around the safe-haven Gold price.

    Daily Digest Market Movers: Gold price bulls remain on the defensive amid hopes for a US-China trade deal

    • US equity indices rose sharply on Tuesday after US President Donald Trump backtracked on his criticism of Federal Reserve Chair Jerome Powell and said that he has no intention of firing him before the expiry of his term in May 2026.
    • Adding to this, upbeat comments from Trump administration officials about US-China trade talks further boosted investors’ confidence and prompted some profit-taking around the safe-haven Gold price following the recent record run.
    • US Treasury Secretary Scott Bessent said that the tariff war between the US and China would de-escalate soon. Later, White House spokeswoman Karoline Leavitt told reporters that the Trump administration is setting the stage for a deal.
    • Russian President Vladimir Putin said that he had a positive attitude towards any peace initiatives. In response, Ukrainian President Volodymyr Zelenskyy said on Tuesday that we are ready to sit down in any format after the ceasefire.
    • Meanwhile, Trump’s rapidly shifting stance on trade policies has eroded investors’ trust and weakened confidence in the US economy. This fails to assist the US Dollar in preserving modest Asian session gains and supports the XAU/USD pair.
    • Furthermore, the markets have been pricing in the possibility that the Federal Reserve will resume its rate-cutting cycle in June and lower borrowing costs at least three times by the end of this year, further benefiting the non-yielding yellow metal.
    • Traders now look forward to the release of global flash PMIs for a fresh insight into global economic health. This, along with trade-related developments, will influence the risk sentiment and provide some impetus to the precious metal.

    Gold price could extend the corrective slide from the all-time peak while below the 23.6% Fibo. level

    From a technical perspective, the precious metal now seems to have found acceptance below the 23.6% Fibonacci retracement level of the latest leg up from the vicinity of mid-$2,900s, or the monthly swing low. This, along with the lack of any further intraday buying, could be seen as initial signs of possible bullish exhaustion and supports prospects for further losses. However, oscillators on the daily chart are still holding comfortably in positive territory and warrant caution before placing aggressive bearish bets. Hence, any subsequent slide below the Asian session low, around the $3,315 area, is likely to find decent support and remain limited near the 38.2% Fibo. level, around the $3,289 region. That said, a convincing break below the latter should pave the way for some meaningful corrective fall in the near term.

    On the flip side, the $3,370 area (23.6% Fibo. level) now seems to act as an immediate hurdle ahead of the $3,400 mark. Some follow-through buying has the potential to lift the Gold price to the $3,424-3,425 horizontal resistance, above which bulls could make a fresh attempt to conquer the $3,500 psychological mark. A sustained strength beyond the latter will set the stage for an extension of the recent well-established uptrend witnessed over the past four months or so.

    Gold FAQs

    Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

    Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

    Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

    The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.



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  • Dollar Rout Deepens; Gold Charges Toward 3500, or Even 4000?

    Dollar Rout Deepens; Gold Charges Toward 3500, or Even 4000?


    The broad selloff in US assets resumed overnight as market confidence took another blow from escalating political pressure on Fed. Major US stock indexes ended the session deep in the red, while 10-year Treasury yields surged back above 4.4%. The Dollar Index also plunged to a fresh three-year low, continuing its dramatic collapse.

    The key catalyst: another public attack by US President Donald Trump, who took to Truth Social to call Fed Chair Jerome Powell a “major loser” and demanded that interest rates be cut “NOW” to avoid a economic slowdown. Trump’s renewed rhetoric has intensified concerns about Fed’s independence at a time of high uncertainty due to his own tariff policies.

    The central bank has so far resisted political pressure, and more Fed officials are set to speak today. Markets expect them to defend the institution’s autonomy and reaffirm their data-dependent approach. Given the current policy fog, particularly surrounding Trump’s shifting trade stance, officials are likely to emphasize the need for further clarity before making any policy adjustments.

    Meanwhile, the 90-day truce on Trump’s “reciprocal tariffs” continues with little meaningful progress in negotiations. Even talks with Japan, one of America’s closest allies, remain stalled. Japanese Prime Minister Shigeru Ishiba stated on Monday that substance matters more than speed in any trade agreement. Additionally, Ishiba vowing not to concede on core issues such as car safety standards and agricultural access. Finance Minister Katsunobu Kato is expected to travel to Washington later this week for discussions with US Treasury Secretary Scott Bessent, with currency issues on the agenda.

    Tensions with China continue to escalate. The Chinese Ministry of Commerce issued a sharp warning that Beijing will retaliate against any countries that cooperate with the US in ways that undermine China’s interests. China’s message reinforces the view that global trade friction is far from resolved, despite temporary pauses.

    Against this backdrop, Gold continues to surge as investors flee to safety. The precious metal’s record-breaking rally shows no signs of slowing, with momentum firmly in upside acceleration.

    Technically, further rise is expected as long as 3283.69 support holds. Next target is 100% projection of 1810.26 to 2789.92 from 2584.24 at 3563.90. Firm break there will pave the way to 138.2% projection at 3938.13, which is close to 4000 psychological level.

    Overall in the currency markets, Dollar is currently the worst performer by a mild, followed by Loonie and then Sterling. Yen is the strongest one, followed by Kiwi and then Euro. Swiss Franc and Aussie are positioning in the middle.

    In Asia, at the time of writing, Nikkei is down -0.07%. Hong Kong HSI is up 0.20%. China Shanghai SSE is up 0.38%. Singapore Strait Times is up 0.90%. Japan 10-year JGB yield is up 0.023 at 1.312. Overnight, DOW fell -2.48%. S&P 500 fell -2.36%. NASDAQ fell -2.55%. 10-year yield rose 0.072 to 4.405.

    Dollar Index crashes to 3-year low; 95 support holds long-term fate

    Dollar Index broke through an important support overnight as recent decline accelerated, and hit the lowest level in three years. The selloff reflects a deepening flight out of US assets, as confidence continues to erode. A major driver of the decline has been US President Donald Trump’s ongoing public attacks on Fed, which have increasingly undermined perceptions of central bank independence and rattled investor trust in US policy credibility.

    Technically, the break of 99.57 (2023 low) confirms resumption of the downtrend from 114.77 (2022 high). Near term outlook will now stay bearish as long as 100.27 resistance holds. Next target is 100% projection of 114.77 to 99.57 from 110.17 at 94.97.

    This support zone around 95 psychological level is especially significant, as it aligns with the long term rising channel support that dates back to 2011.

    Decisive break of 95 ahead could firstly trigger further medium term downside acceleration. More importantly, that could also mark the end of the broader uptrend that began from 2008 low at 70.69.

    Such a structural breakdown would open the door for sustained weakness with medium-term downside targets around the 89.20–90.00 range, with risk of entering a new secular downtrend in the years ahead.

    New Zealand posts surprise NZD 970m trade surplus as exports surge 19%

    New Zealand recorded stronger-than-expected trade surplus of NZD 970m in March, far exceeding forecasts of NZD 80m. The surprise was driven by a robust 19% yoy increase in goods exports, which rose by NZD 1.2B to NZD 7.6B. Imports also grew, up 12% yoy to NZD 6.6B.

    Export performance was particularly strong across key trading partners. Shipments to China rose by NZD 371m (23% yoy), while exports to the US and the EU grew by 22% yoy and 51% yoy respectively. Exports to Japan also increased 11% yoy, although shipments to Australia dipped slightly, down -0.47% yoy.

    On the import side, the largest increases came from the US, with a 48% yoy jump worth NZD 243m. This was followed by China and the EU, which posted 14% yoy and 19% yoy gains respectively. Imports from South Korea bucked the trend, falling -12% yoy.

    USD/JPY Daily Outlook

    Daily Pivots: (S1) 140.18; (P) 141.16; (R1) 141.85; More…

    Intraday bias in USD/JPY remains on the downside for the moment. Current fall from 158.86 is in progress for 139.57 support. Strong support could seen from 139.26 fibonacci level to bring rebound. On the upside, above 141.60 minor resistance will turn intraday bias neutral first. However, decisive break of 139.26 will carry larger bearish implications, and target 138.2% projection of 158.86 to 146.52 from 151.20 at 134.14.

    In the bigger picture, price actions from 161.94 are seen as a corrective pattern to rise from 102.58 (2021 low), with fall from 158.86 as the third leg. Strong support should be seen from 38.2% retracement of 102.58 to 161.94 at 139.26 to bring rebound. However, sustained break of 139.26 would open up deeper medium term decline to 61.8% retracement at 125.25.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    22:45 NZD Trade Balance (NZD) Mar 970M 80M 510M 392M
    12:30 CAD Industrial Product Price M/M Mar 0.30% 0.40%
    12:30 CAD Raw Material Price Index M/M Mar 0.00% 0.30%
    14:00 EUR Eurozone Consumer Confidence Apr P -15 -15

     



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  • Gold price in Saudi Arabia: Rates on April 22

    Gold price in Saudi Arabia: Rates on April 22


    Gold prices rose in Saudi Arabia on Tuesday, according to data compiled by FXStreet.

    The price for Gold stood at 420.26 Saudi Riyals (SAR) per gram, up compared with the SAR 413.08 it cost on Monday.

    The price for Gold increased to SAR 4,902.14 per tola from SAR 4,818.14 per tola a day earlier.

    Unit measure Gold Price in SAR
    1 Gram 420.26
    10 Grams 4,202.87
    Tola 4,902.14
    Troy Ounce 13,071.69


    FXStreet calculates Gold prices in Saudi Arabia by adapting international prices (USD/SAR)
    to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of
    publication. Prices are just for reference and local rates could diverge slightly.

    Gold FAQs

    Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

    Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

    Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

    The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.


    (An automation tool was used in creating this post.)



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  • Gold price explores past ,400 as Trump-Powell clash sparks Fed independence fears

    Gold price explores past $3,400 as Trump-Powell clash sparks Fed independence fears


    • Gold hits fresh all-time high as Trump attacks Powell, calling him “a major loser” for delaying rate cuts.
    • DXY plunges to 97.92 as Fed independence is questioned and stagflation risks remain in focus.
    • Traders brace for key Fed speeches this week from Jefferson, Harker, and Kashkari amid growing policy uncertainty.

    Gold price begins the week on a higher note, gaining over 2.56% and refreshing a previous record high as the precious metal hits $3,430 on uncertainty about comments that threat to curtail the Federal Reserve’s (Fed) independence. At the time of writing,  XAU/USD trades at $3,419 after hitting a daily low of $3,329.

    Demand for bullion has increased as United States (US) President Donald Trump continues to exert pressure on the Fed. Fed Chair Jerome Powell called him a “major loser” and said he is always too late to reduce borrowing costs.

    Last week, Powell said the US central bank is in wait-and-see mode and even flagged the chance of a stagflationary scenario, acknowledging, “We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension.”

    Growing tensions between Trump and Powell, along with controversial trade policies, weighed on the Greenback, which, according to the US Dollar Index (DXY), has fallen to three-year lows of 97.92.

    Data-wise, the US economic docket is absent, though it would gather traction mainly supported by Fed speakers. Vice-Chair Philip Jefferson, Philadelphia Fed Patrick Harker, and Minneapolis Neel Kashkari are all set to deliver remarks on Tuesday.

    Daily digest market movers: Gold price soars to record high amid high US yields

    • The US 10-year Treasury yield rises four basis points to 4.373% yet fails to cap Bullion prices.
    • US real yields followed suit, climbing three and a half bps to 2.14%, as shown by the US 10-year Treasury Inflation-Protected Securities yields
    • In rates markets, money market traders have priced in 94.5 basis points of Fed rate cuts by the end of 2025, with the first cut expected in July.
    • Data-wise, this week the US economic docket will be packed by a flurry of Fed speakers, S&P Global Flash PMIs, Durable Goods Orders and the University of Michigan Consumer Sentiment final reading.

    XAU/USD technical outlook: Gold price poised to challenge $3,450 in the near term

    The uptrend in Gold prices remains in play, even with the chance of testing the $3,500  level touted by Citi to be reached in the next three months. The Relative Strength Index (RSI) turned overbought, an indication that the precious metal could be set for a pullback, but a breach of the latest peak suggests that bulls could reach $3,450 in the near term.

    Conversely, if XAU/USD tumbles below $3,400, the first support would be the April 17 high of $3,357, followed by $3,300.

    Gold FAQs

    Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

    Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

    Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

    The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.



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  • Dollar Slumps as Fed Independence in Question; Euro and Gold Surge on Haven Demand

    Dollar Slumps as Fed Independence in Question; Euro and Gold Surge on Haven Demand


    Dollar weakened broadly in thin holiday trading today, dragged down by mounting concerns over the independence of the Federal Reserve. Investor anxiety escalated after White House economic adviser Kevin Hassett indicated that US President Donald Trump is continuing to explore whether he can remove Fed Chair Jerome Powell. While the legal basis for such a move is untested and unclear, the mere suggestion of political interference in the central bank’s policy process has significantly undermined market confidence.

    This brewing conflict comes amid already heightened uncertainty surrounding US trade policy. Trump’s aggressive use of tariffs, most recently through sweeping reciprocal levies, has put the Fed in a difficult position. Officials including Powell have repeatedly warned that tariffs could simultaneously fuel inflation and suppress economic growth, increasing the risk of stagflation. A sudden crystallization of the threat to Fed independence would not only worsen market volatility but also raise tail risks, potentially triggering a broader loss of faith in US assets.

    Powell, for his part, has firmly defended the Fed’s independence. In remarks last week, he asserted, “We’re never going to be influenced by any political pressure… Our independence is a matter of law.” He also reminded that Fed governors “are not removable except for cause,” and emphasized the long, fixed terms that protect against political meddling. While the “cause” does not typically include policy disagreements, the intensifying standoff with the White House has cast a long shadow over US institutions. Ad for now, the markets appear to be voting with their feet—out of the Dollar and into alternatives.

    Euro has emerged as the biggest gainer in today’s subdued session, extending recent strength as investors seek refuge in the most liquid and viable alternative to Dollar. With its deep capital markets, relative political stability, and credible central bank, Euro is increasingly seen as a safer store of value amid the implosion of confidence in US governance. Other safe havens like the Japanese Yen and Swiss Franc are also holding firm, but it is Euro and Gold that are leading the charge.

    Gold prices have surged to fresh record highs, fueled by a flight to safety and fears of policy instability. Technically, Gold is still in upside acceleration as suggested in D MACD. Despite overbought condition, there is no sign of topping yet. Decisive break of 161.8% projection of 2293.45 to 2789.92 from 2584.24 at 3387.52 will pave the way to 200% projection at 3577.18 next. Outlook will stay bullish as long as 3167.60 resistance turned support holds, in case of retreat.

    China holds benchmark lending rates steady

    China kept its benchmark lending rates unchanged for the sixth consecutive month today. One-year loan prime rate was held at 3.1% and the five-year LPR steady at 3.6%.

    Subdued domestic inflation and growing global trade headwind, particularly the latest wave of tariff threats from the US, argue in favor of further policy easing However, PBoC appears reluctant to move ahead of Fed.

    A premature rate cut could exacerbate downward pressure on the yuan, fueling capital outflows and financial instability.

    April PMIs to gauge global business fallout from tariffs

    The spotlight in the coming week will be on the flash PMI readings for April, covering major economies including Australia, Japan, the Eurozone, the UK, and the U.S. These surveys will serve as a timely barometer for assessing how global business conditions have responded to the surge in trade tensions following US President Donald Trump’s “Liberation Day” tariff announcement earlier this month.

    March PMIs had already reflected some of the early impact of trade policy uncertainty, particularly in North America. Notable takeaways included rising manufacturing input costs in the US and early signs of softening trade flows.

    The upcoming data will be critical in identifying how deeply those measures are now affecting business conditions. Analysts will be watching for deterioration in new orders, delivery times, and price components—key indicators of disrupted supply chains and cost pass-through.

    Beyond the PMIs, a series of supporting data will also shape market sentiment. US durable goods orders will be closely watched for signs of weakening beyond autos. Germany’s Ifo business climate and expectations index will give a read on sentiment in Europe’s largest economy. Additionally, retail sales data from both the UK and Canada could reflect how consumers are responding to expected price shifts and economic uncertainty.

    Here are some highlights for the week:

    • Monday: China loan prime rate decision.
    • Tuesday: Canada IPPI and RMPI; Eurozone consumer confidence.
    • Wednesday: Australia PMIs; JapanPMIs, tertiary industry index; Eurozone PMIs, trade balance; UK PMIs; US PMIs, new home sales, Fed’s Beige Book.
    • Thursday: Japan corporate service prices; Germany Ifo; US jobless claims, durable goods, existing home sales.
    • Friday: Japan Tokyo CPI; UK Gfk consumer sentiment, retail sales; Canada retail sales.

    EUR/USD Daily Outlook

    Daily Pivots: (S1) 1.1314; (P) 1.1363; (R1) 1.1449; More…

    EUR/USD’s rally resumed by breaking through 1.1472 today and intraday bias is back on the upside. Current rise from 1.0176 should target 161.8% projection of 1.0358 to 1.0953 from 1.0731 at 1.1694 next. On the downside, below 1.1357 minor support will turn intraday bias neutral and bring consolidations again, before staging another rally.

    In the bigger picture, rise from 0.9534 long term bottom could be correcting the multi-decade downtrend or the start of a long term up trend. In either case, further rise should be seen to 100% projection of 0.9534 to 1.1274 from 1.0176 at 1.1916. This will now remain the favored case as long as 55 W EMA (now at 1.0776) holds.

    Economic Indicators Update

    GMT CCY EVENTS ACT F/C PP REV
    01:00 CNY 1-Y Loan Prime Rate 3.10% 3.10% 3.10%
    01:00 CNY 5-Y Loan Prime Rate 3.60% 3.60% 3.60%
    14:00 USD Leading Indicator Apr -0.50% -0.30%

     



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