How was gold affected after the unemployment data appeared? by Investing.com

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© Reuters.

Written by Gina Lee

Investing.com – It rose in Tuesday morning trade in Asia, settling to a one-week low hit in the previous session. While weak before that could indicate when the US Federal Reserve is likely to start declining assets.

It also rose 0.24 to $1,810.15 by 12:30PM ET (4:30AM GMT), and dropped to its lowest level since July 6 during the previous week. The dollar, which usually moves in reverse with gold, fell on Tuesday.

The New York Federal Reserve’s monthly survey said investors widely expect the economy to continue its rapid recovery from COVID-19 over the next year. According to the report, expectations for inflation, earnings, income growth and spending increased in June.

Investors are also awaiting the June CPI, due later today, as well as due later tomorrow. In Asia, investors digested the better-than-expected Chinese trade data released earlier today. The data said exports rose 32.2% year-on-year, imports grew 36.7% year-on-year, and the trade balance stabilized at $51.53 billion in June.

Federal Reserve Chairman Jerome Powell will also testify before Congress on Wednesday and Thursday, with his comments scrutinized for hints about when the central bank could begin reducing assets. Across the Atlantic, the European Central Bank will meet the following week to discuss its switch to a 2% inflation target as well as moving forward with its monetary policy.

Other central banks making policy decisions include the Reserve Bank of New Zealand on Wednesday, the Bank of Korea on Thursday, and the Bank of Japan on Friday. With the UK due to remove almost all remaining Covid-19 restrictions in England on July 19, Prime Minister Boris Johnson on Monday urged caution as the number of cases increases.

And in another sign that COVID-19 is far from over, WHO Director-General Tedros Adhanom Ghebreyesus warned on Monday that the delta variant is quickly becoming dominant, as many countries struggle with vaccine shortages.

In terms of other precious metals, it rose 0.3 percent, while platinum declined by 0.4 percent.

Update

Just a moment ago, the results were released, which is the Fed’s favorite tool for monitoring inflation in the US.

The results were positive, recording 0.9% against an estimate of 0.4%, and it is noteworthy that the last percentage was 0.7%.

Gold is down at these moments by 0.33%, recording 1800, with a loss of nearly six dollars.

It is reported that the market is waiting for the Fed Chairman, in front of the Senate on Wednesday and Thursday.

Powell announced in his last press conference that the Fed will not allow inflation higher than 5%, and today, on a monthly basis, it recorded an increase of 5.4%, in light of the division among the Fed members regarding the future of monetary policy.

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Gold remains captive to this conflict, while waiting for more clarity. As gold is considered one of the safe havens, this data in light of the monetary easing is supposed to move its price to the upside.

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