The oil price looks optimistic. What are the reasons?
Gold goes down, rebounding from 2-1/2 week maximums
On Thursday, gold declined, rebounding from last session's two-and-a-half week maximums reported after mixed American economic reports confounded hopes for a more hawkish rate lift policy by the US main financial institution.
Comex gold futures headed south 0.18% being worth $1,355.6 per troy ounce, having soared to a two-and-a-half week peak of $1,358.50 yesterday.
The number one precious metal initially went down because the evergreen buck rallied right after on Wednesday the Commerce Department informed that in January consumer prices added more than anticipated - by 0.5%. The previous month consumer prices edged up 2.1% year-on-year, thus surpassing hopes for a 1.9% leap.
The vast majority of financial analysts are assured that soaring inflation would turn to be a sort of driver, pushing the major US financial institution toward lifting interest rates at a faster tempo than currently anticipated.
However, the US currency’s revenues appeared to be short lived. It’s because a separate report disclosing that American retail sales went down 0.3% in January versus hopes for a 0.2% rally, powered worries that the Federal Reserve could struggle to lift interest rates rapidly enough just to compensate inflation pressures.
Gold happens to be ultra-sensitive to moves in both the evergreen buck and US rates. A weaker greenback makes gold less costly for keepers of foreign currency. On the contrary, a rally in American rates raised the opportunity cost of keeping non-yielding stuff, including bullion.
On Thursday, the US dollar index, normally employed to assess the US currency’s actual strength versus a trade-weighted basket of six main currencies, headed south 0.18% demonstrating an outcome of 88.74, which is its lowest value since February 2.
Apart from that silver futures headed south 0.11% on the Comex, offering an outcome of $16.87 a troy ounce.
S&P 500 skyrocketed to the all-time high on optimism that Biden’s fiscal stimulus will support economic growth and boost corporate earnings.
PMI reports from the EU, the UK, and the USA will be released during the day!
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.