As the rising US dollar and treasury interest rates continued to put pressure on the demand for ingot, gold prices fell to the lowest level of about two weeks on Wednesday. What direction and level does analysts’ gold estimates point to? We have compiled for our readers.
“Long Squeeze seems to continue for gold”
Kriptokoin.comAs we have reported as on Tuesday, the strengthening in the dollar and the indicator of the US 10 -year treasury interest rates fell by 1.8 %, leaving the precious port entrances of the port entrances. Oanda Senior Analyst Jeffrey Halley makes the following comment:
The US Dollar is still strong today and China refuses to reduce the loan interest rates of 1 and 5 years, while Long Squeeze seems to continue for gold in Asia.
Investors prepared to increase the interest rates of Federal Reserve in an aggressive way, while the US treasury interest rates were close to the highest levels of several years. Gold is very sensitive to the rising US short -term interest rates and bond returns, which increases the cost of opportunities of keeping the ingredients without returns.
“Gold, rising interest rates and inflation and geopolitical risks”
On Monday, gold approached a $ 2,000 lock level, but since then it has been under pressure. In a note, UBS analysts noted that the war in Ukraine, the sharp increase in global inflation, the Fed’s hawk axis, and then the reversal of a 2 -year/10 -year US Treasury return curve, the capacity of more than one risk protection.
Louis Fed President James Bullard reiterated the claim to raise interest rates to 3.5 %by the end of the year to restrain inflation. UBS analyst Giovanni Staunovo makes the following assessment:
Sahin comments from the FED officials, in the United States, raising nominal and real interest rates in the United States put pressure on gold. However, close -term high inflation and geopolitical risks will continue to support entrance to gold products and keep gold prices at existing levels in the coming weeks.
Phillip Streble’s gold estimates indicate this level
In addition to political and economic crises, gold is considered as a safe value tank during rising inflation, while higher interest rates turn into an increasing cost of opportunities for keeping the gold without returns. Blue Line Futures Chief Market Strategist Phillip Streess in Chicago says:
In the near term, we can see some withdrawal underneath. Gold can drop to $ 1,920. Under the pressure of gold, which returned to the positive interest for the first time in two years.
Gold estimates of TD Securities economists
The war in Ukraine increases both geopolitical uncertainty and inflation risks. According to the report of TD Securities economists, the perception of the war in Ukraine and the perception that the US central bank is behind the curve continues to be supportive elements for gold forecasts. Economists make the following evaluations:
A war potential in Ukraine increases the demand for yellow metal as a safe port, increasing both geopolitical uncertainty and inflation risks at the same time. This trend also worsened with fears that the treasury bonds could be less powerful ports in the higher inflation regime, with a simultaneous decline in global stocks and bond prices.
According to the economists, the Fed gave the signals of the intention of combating inflation by reaching a policy impartiality by the end of the year and initiating an aggressive QT (quantitative tightening) regime, while the participants were pleased to keep some options against the specified plan of the FED.
COMMERZBANK: Rests gold determination
Gold remained almost unchanged against the US treasury bond rates and a strong dollar rising on Wednesday. According to the report of Commerzbank economists, the yellow metal also ignores the latest FED notifications. Economists say:
Gold continues to maintain its power in the face of powerful US dollar and high bond returns. The statements made by representatives of the US Federal Bank do not have any impact on gold.
ETF investors purchased shares via balance last week. Gold ETFs followed by Bloomberg recorded approximately 16 tons of entry. This was the 13th week showing the entrances. Since the beginning of the year, the entrances have exceeded 273 tons. According to economists, this makes ETF investors an important driving force of the gold price. Economists emphasize the following issue:
CFTC’s data reveals that speculative financial investors have bets more bets on recently increasing gold prices. They expanded their net Long positions by 15 %per week until April 12, ending a five -week withdrawal process.
