Gold Update The price of gold (XAU/USD) is stable despite the US Census Bureau announcing better-than-expected September Retail Sales data, a key indicator of consumer spending, the major engine of the US economy. Consumer spending increased at a faster rate of 0.7% versus forecasts of 0.3%, but it still lagged behind the 0.8% growth seen in August as a result of rising petrol costs.
Amid rising Middle East tensions, the precious metal is anticipated to hold its ground ahead of US President Joe Biden’s trip to Israel and Federal Reserve (Fed) Chair Jerome Powell’s address, which is anticipated to offer important information on interest rates. Investors are hoping Powell would agree with other Fed members who have lately stated that higher bond yields are sufficient to contain inflation and support a neutral monetary policy.
USD/JPY Analysis The Bank of Japan (BoJ) is anticipated to release its inflation predictions for the fiscal years 2023 and 2024 earlier than expected, which caused the USD/JPY pair to briefly dip as low as 148.80 before swiftly recovering to its wider trading range around 149.50.
The likelihood of Japanese authorities intervention in the forex market is dwindling. Authorities in Japan are concerned about further declines in the Japanese Yen and hold erratic movements accountable for them. In the past, volatility increases lasted for days or even a few weeks, but the BoJ’s adoption of an easy monetary policy has made the Japanese Yen less appealing to certain investors. As a result, despite a weak demand for the Japanese Yen supported by expansionary monetary policy, the authorities are powerless to turn the tide.
Natural Gas Ahead of the US opening bell, natural gas prices are beginning to decline. European Gas futures were down more than 3% prior to the latest decline in US futures. In the meantime, US banks Goldman Sachs and Bank of America released their quarterly results, beating estimates while issuing cautionary statements over the state of the US consumer.
Bitcoin Bounce In the early hours of Tuesday morning European session, Bitcoin (BTC) was trading above the $28,400 mark amid generally optimistic predictions for the near-term future of the currency and a fundamental crypto law that probably helped support prices.
In a step that could boost crypto businesses in the state and certainly aid long-term sector growth, California Governor Gavin Newsom signed a crypto licencing bill on Friday that is scheduled to go into effect in July 2025.