Rate Hike Priced-in, Gold Prices to Rise as Fed Clings to Status Quo Later

  • Gold prices holding range as FOMC rate decision nears
  • Status-quo Fed may punish US Dollar, send gold prices higher
  • Crude oil prices seesaw on Saudi output boost, API data
– Gold prices edged lower as the US Dollar recovered from post-NFP losses but remained well within their near-term range. Traders were probably reluctant to commit to significant trend progression ahead of the upcoming FOMC policy announcement.
The priced-in probability of a rate hike implied in Fed funds futures stands at 100 percent. This means the increase itself may have limited market-moving potential, putting the spotlight on a revised set of economic and rate path projections as well as a press conference with Chair Yellen.
US economic conditions have been relatively stable since the beginning of the year. Furthermore, Fed officials continue to operate in an environment marred by considerable fiscal policy uncertainty. On balance, this suggests they will opt against major changes in forecasts or rhetoric.
The markets’ response to last week’s jobs data may be a blueprint for such an outcome. The figures sustained the status quo but did not advance the case for a still-steeper tightening path. That registered as a disappointment and sent the greenback lower as gold rose. More of the same may be in store this time.
Crude oil prices dropped to set a new three-month low after an OPEC report showed Saudi Arabia boosted output in February. Kingdom officials said the increase was meant to refill stockpiles and claimed shipments continued to fall but traders still worried that the cartel’s supply reduction deal may be unraveling.
The WTI benchmark swiftly erased intraday losses after API said US inventories fell by 531k barrels last week. Official DOE figures are expected to show a build of 3.25m barrels over the same period. If confirmed, that might rekindle selling pressure while a print closer to the API estimate may give prices a further boost.
The monthly report from the IEA is also due and may offer a contrasting view of February’s OPEC supply trends compared to what was on offer in the cartel’s own accounting. Further evidence pointing to ebbing output cut compliance may spur on the bears.
VISIT - Profit Street

Comments

Post a Comment

Popular posts from this blog

Majority of states have very few stock market investors

Image
Stock market movements make headlines every day. How many people invest in stock markets in India? Which state has most stock market investors in India? Mint has analyzed statistics from the Bombay Stock Exchange (BSE) to answer some of these questions. The BSE data used unique client codes to identify the number of stock market investors in each state and union territory. It identified 3.23 crore registered stock market investors in total. All investor accounts are linked to a demat account, though there maybe duplication, for example with one demat account connected to investor accounts with more than one brokerage. A total of 98.7% of these had clear state/union-territory wise data. It was not defined for 4.29 lakh investors. This works out to less than 7% of India’s 48.18 crore-strong workforce. The exchange updates the data daily. The analysis used numbers from 20 February 2017. Maharashtra alone accounts for more than one-fifth of India’s stock market investors. Gujar
Read more

Stock exchanges in IFSCs may permit trading in equity derivatives: SEBI

Image
The Securities and alternate Board of India (Sebi) on Thursday stated stock exchanges running in global financial services centres (IFSCs) may allow dealing in fairness derivatives. "in line with the recommendations of the risk administration review Committee of SEBI, it has been decided to specify derivatives on equity shares of an organization integrated in India as permissible safety," the market regulator's round mentioned. "...the known inventory exchanges operating in IFSCs may allow dealing in derivatives on fairness shares, topic to prior approval of Sebi," it brought. in line with the round, the Market large position restrict (MWPL) for "derivatives on fairness shares" will probably be equal to 10 per cent of the collection of shares held through non-promoters within the related underlying safety (free-go with the flow conserving). further, the MWPL for "derivatives on equity shares" in regarded inventory exchanges
Read more

Expect growth to slow in the next 2-4 quarters due to GST: L&T’s R Shankar Raman

Anticipate that development will moderate in the following 2-4 quarters because of  #GST: L&T's R Shankar Raman Taking a gander at all the nations that have executed it from their inheritance tax collection structures, all have taken a plunge in development for two to four quarters, said R Shankar Raman, CFO, Larsen and Toubro. In a selective, CNBC'S Akiko Fujita made up for lost time with R Shankar Raman, CFO, Larsen and Toubro to get some information about the Modi government's greatest expense change – products and enterprises assess (GST) and the effect of that on his organization and the perspectives of India Inc. He stated, India Inc is content with the change subjects/changes taken up by Modi government yet just stressed over speed of making an interpretation of the subjects into activities. "The pace at which the subjects were taken off, to the majority of our psyches - it resembled homework of usage has additionally been tended to yet
Read more