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Home » News » ForexLive Asia-Pacific FX News Wrap: Gold hit a record high, silver and copper surged also

The week began with attention on Federal Reserve Chair Powell’s virtual commencement address, though he refrained from discussing economic policy due to his recent Covid diagnosis.

Data was limited, with the People’s Bank of China maintaining the Loan Prime Rates at 3.45% for the 1-year and 3.95% for the 5-year, indicating potential future monetary easing to support economic stimulus through ultralong special Treasury bonds.

In a tragic development, a helicopter crash in Iran claimed the lives of President Ebrahim Raisi and Foreign Minister Hossein Amir-Abdollahian, potentially influencing oil prices if geopolitical tensions escalate.

Meanwhile, Saudi Arabia’s King Salman is undergoing treatment for lung inflammation, prompting Crown Prince Mohammed bin Salman to postpone his visit to Japan.

These events contributed to a rise in oil prices, while gold hit a record high, and silver and copper also saw significant gains. The precious metals market surged, driven by investor interest in safe-haven assets amid global uncertainties.

The USD/JPY fluctuated near 156.00, with major currencies remaining in narrow trading ranges. Market participants are closely monitoring these developments for potential impacts on global financial markets and commodity prices.

Brent oil, tiny opening gap to begin the week:

brent oil iran helicopter

Image Source: Forexlive

Final Thoughts

Federal Reserve Chair Powell’s virtual commencement address avoided economic policy discussions due to his recent Covid diagnosis.
The People’s Bank of China maintained Loan Prime Rates, hinting at possible future monetary easing to stimulate the economy.
A helicopter crash in Iran killed President Raisi and Foreign Minister Amir-Abdollahian, raising concerns about geopolitical tensions and oil prices.
Saudi Arabia’s King Salman is receiving treatment for lung inflammation, causing Crown Prince Mohammed bin Salman to delay his Japan visit.
Oil prices rose, and gold hit a record high, with silver and copper also surging, driven by investor interest in safe-haven assets amid global uncertainties.
The USD/JPY hovered near 156.00, with major currencies in narrow trading ranges as markets closely watch these developments for potential impacts on global financial markets and commodity prices.

Recent news

Gruyere increases production in pursuit of gold

Gold Price Remains Capped in a Familiar Trading Range Ahead of US Services PMI Data

Gold prices managed to remain above a multi-week low on Tuesday, hovering around the $2,316-$2,315 range. This slight dip came after a minor recovery in the US Dollar (USD), which had previously hit its lowest point in over two months. However, expectations that the Federal Reserve (Fed) will begin cutting interest rates later this year kept the USD's recovery in check. These expectations are based on weaker US macroeconomic data, which also keeps US Treasury bond yields low, thus supporting gold prices during the European session on Wednesday. Market Influences on Gold Prices Several factors have contributed to the current stability in gold prices. Geopolitical risks, particularly the ongoing conflicts in the Middle East, have bolstered the metal's safe-haven appeal, pushing it closer to the 50-day Simple Moving Average (SMA). Despite these supportive elements, gold (XAU/USD) remains within a narrow trading range established over the past week. Investors appear cautious, opting to wait for critical US employment data, particularly the Nonfarm Payrolls (NFP) report due on Friday, before making significant moves. In the meantime, the ADP report on private-sector employment and the ISM Services PMI, both expected later today, are anticipated to provide some short-term market direction. Gold Prices and the US Dollar The US Dollar showed a modest recovery from its recent two-month low on Tuesday, exerting some downward pressure on gold prices. However, poor US macroeconomic data helped limit these losses. The Job Openings and Labor Turnover Survey (JOLTS) revealed a significant drop in job openings, falling by 296,000 to 8.059 million in April, marking the lowest level in over three years. This follows a disappointing ISM Manufacturing PMI report on Monday, which indicated a surprising weakness in business activity and suggested a cooling US economy. Concerns about a more substantial slowdown in the US economy have solidified expectations of a rate cut by the Fed in September, leading to lower US Treasury bond yields. The two-year and ten-year Treasury yields are both near two-week lows, capping gains for the USD and providing support to non-yielding assets like gold. Traders are now keenly watching Wednesday's US economic data releases, including the ADP report and the ISM Services PMI, for short-term opportunities. However, the primary focus remains on the upcoming NFP report, which is expected to set the stage for the next significant movement in gold prices. Technical Analysis of Gold Prices From a technical perspective, gold prices have found acceptance below the 50-day SMA. Oscillators on the daily chart are beginning to gain negative traction, indicating the potential for further losses. A decline below the multi-week low of $2,315-$2,314, reached on Tuesday, would reinforce a bearish outlook, potentially driving the XAU/USD below the $2,300 mark and towards the $2,280 support level. Continued selling pressure could trigger further declines, extending the corrective phase observed over the past two weeks. Conversely, any substantial upward movement would face strong resistance around the $2,349-$2,350 area. The next significant hurdle is at $2,360-$2,364, and clearing this level decisively could allow gold prices to climb towards the $2,385 mark, with an eventual target of $2,400. Continued momentum could push prices further to $2,425 and possibly to the all-time high of $2,450 reached in May. Looking Ahead The gold market remains in a state of cautious anticipation, with traders closely monitoring upcoming US economic data for signs of the economy's health and potential future actions by the Fed. The ADP employment report and the ISM Services PMI are expected to provide some immediate market direction, but the more critical Nonfarm Payrolls report on Friday will likely be the key determinant for the next significant move in gold prices. In summary, while gold prices have managed to hold steady despite recent market volatility, the metal's future trajectory will heavily depend on forthcoming US economic indicators and the Fed's policy decisions. Investors are advised to stay informed and ready to adjust their positions as new data emerges. Conclusion Gold prices are stable, trading around $2,316-$2,315 despite recent pressures from a slightly recovering US Dollar. Ongoing geopolitical tensions and expectations of Federal Reserve rate cuts support gold’s safe-haven appeal. Investors are cautious, awaiting key US employment data, particularly the Nonfarm Payrolls report, which will be crucial for market direction. Technical indicators suggest potential for further declines if gold drops below $2,300, while significant resistance is seen at $2,350. With gold prices sensitive to economic data and Fed policy, staying informed and ready to adapt is essential for investors.

Gruyere increases production in pursuit of gold

Gold Prices Rise For Their Strongest Week In Six

Gold prices surged on Friday, marking their strongest week in six, propelled by renewed speculation of an interest rate cut from the Federal Reserve. Spot gold ascended by 0.4% to $2,369 after reaching a more than two-week peak earlier in the day. Spot rates displayed a rise of slightly over 2% throughout the week. Comex gold futures followed suit, climbing by 1.14%, equivalent to over $26 per ounce, to reach $2,366.90, with a peak of approximately $2,385 per ounce during trading sessions. The Comex front-month price witnessed an uptick of nearly 2.5% for the week. According to the World Council, the Australian dollar gold price concluded the week around $3,575 after touching $3,587 earlier on Friday. Thursday's data revealed a higher-than-anticipated surge in Americans filing new claims for unemployment benefits, with 231,000 individuals receiving benefits, marking the highest figure since last August. Tim Waterer, chief market analyst at KCM Trade, attributed gold's resurgence to softer U.S. macro data this week. He remarked, "Gold has regained its mojo this week, thanks to some softer U.S. economic data. Initial jobless claims statistics were worse than expected, after the poor NFP (nonfarm payrolls) figures last Friday, indicating that the labor market may be loosening up." The upcoming release of the U.S. producer price index and consumer price index data is anticipated to significantly impact the metal's trajectory. Waterer suggested that these inflation reports could influence the expected timeline for rate cuts. If inflation trends lower, gold stands to benefit, he added. Comex copper also saw gains on Friday, rising by 1.65% to close at $4.65 a pound in New York, translating to a weekly increase of 1.8%. Conclusion: Gold prices surged, marking their strongest week in six, driven by speculation of a Fed interest rate cut. Spot gold rose by 0.4% to $2,369, with a weekly increase of over 2%. Comex gold futures climbed by 1.14% to $2,366.90 per ounce. The Australian dollar gold price closed around $3,575. Thursday's data showed a surge in U.S. unemployment claims, hitting 231,000, the highest since last August. Gold's resurgence was attributed to softer U.S. macro data by Tim Waterer, chief market analyst at KCM Trade. The upcoming release of U.S. producer and consumer price index data is expected to impact gold's trajectory. Comex copper also saw gains, rising by 1.65% to close at $4.65 a pound in New York, with a weekly increase of 1.8%.

Gruyere increases production in pursuit of gold

De Grey Mining Initiates $395 Million Equity Raise for Western Australia Gold Endeavor

De Grey Mining, an Australian gold mining company, has unveiled a significant equity raise amounting to A$600 million ($395.34 million) on Wednesday. This strategic move is aimed at fulfilling a crucial precondition necessary to secure debt financing for its ambitious Hemi project situated in Western Australia. According to a filing with the exchange, the equity raise will involve the issuance of 545.5 million shares by De Grey Mining. The breakdown comprises a substantial institutional placement totaling A$344 million alongside a pro-rata accelerated non-renounceable entitlement offer of A$256 million, structured at 1 for 7.95. The placement's offering price of A$1.10 denotes a 15% discount from the stock's most recent closing price of A$1.27 recorded on May 7. De Grey emphasized the proactive nature of finalizing the equity aspect of the Hemi project's financing, noting its pivotal role in streamlining planning and management processes. This includes the expedited procurement of long-lead items and the appointment of contractors, as outlined in their official statement. The mining company is gearing up for full-scale construction activities at the Hemi gold project slated to commence in the latter half of 2024. With construction anticipated to conclude by the second half of 2026, De Grey is eyeing the commencement of gold production at the mine during this period. ($1 = 1.5177 Australian dollars) Conclusion In conclusion, De Grey Mining's successful equity raise of A$600 million marks a significant milestone in advancing its Hemi project. With this crucial financing secured, the company is poised to accelerate its construction timeline and move closer to gold production, underscoring its commitment to growth and development in the Australian mining sector.