fbpx

PU Prime App

Exclusive deals on mobile

  • Market Insights  >  Weekly Outlook

8 December 2022,05:09

Weekly Outlook

Gold Struggles to Find Direction even as China Eases Covid Restrictions

8 December 2022, 05:09

Share on:
FacebookLinkedInTwitterShare
Share on:
FacebookLinkedInTwitterShare

China has announced that it will be lifting its strictest covid policies, including being forced to quarantine in state facilities and the need to test before entering most venues. The easing has been released in a series of new guidelines that include a ban on blocking fire exits, encouraging vaccinations among the elderly, and shortened lockdown periods. 

The easing of covid restrictions has given the markets hope that the world’s second-largest economy will be transitioning towards a “living with covid” model that most countries have embraced. The hope is that China will re-open an economy that have been plagued by lockdowns and curbs – and, among other things, ease supply chain disruptions and restore air travel.

That said, for investors looking forward to risk-positive news, China’s economic reopening is being tempered by warnings of a recession coming in from Wall Street even as growth slows in the U.S. and beyond.

Post-Market

For gold traders, it’s been a directionless few days as bulls and bears fight for dominance in the face of mixed hints as to whether things should be risk-on or risk-off. Gold has been trading in a relatively tight range, rising 1% overnight following the retreating U.S dollar and Treasury yields  – just after a 1.6% increase on the back of a surprisingly high read on the U.S. ISM services data. 

The reopening of China, traditionally the world’s biggest consumer of physical gold, also lends further support to the precious metal. The country’s central bank has recently reported that it bought 32 tonnes of gold in November, the first increase in reserves since 2019. 

“Gold in the next few trading sessions has more downside risk than upside, prior to the FOMC meeting,” said Michael Langford, director at corporate advisory firm AirGuide.

Where can investors find further clues on the direction of gold? Watch out for the U.S. CPI figures, which will be released at 15:30 (GMT+2) on Tuesday, 13 December. The inflation read will dictate further Fed direction on interest rates – next released at 21:00 on 14 December (GMT+2) – and thus whether it is worth it for the markets to move toward the non-yielding gold. 

As a  friendly reminder, do keep an eye on market changes, control your positions, and manage your risk well. 

Bắt đầu Giao dịch với lợi thế

Giao dịch ngoại hối, chỉ số, Kim loại,...với phí chênh lệch thấp trong ngành và khớp lệnh nhanh như chớp

  • Bắt đầu giao dịch với số tiền nạp thấp nhất là $50 cho tài khoản Standard của chúng tôi.
  • Hỗ trợ 24/7.
  • Truy cập hàng trăm công cụ, công cụ giáo dục miễn phí và một số chương trình khuyến mãi tốt nhất xung quanh.
Tham gia ngay

Latest Posts

Mở tài khoản nhanh chóng và dễ dàng

Tạo tài khoản Live
  • 1

    Đăng ký

    Đăng ký Tài khoản Live PU Prime với quy trình đơn giản của chúng tôi

  • 2

    Nạp tiền

    Dễ dàng nạp tiền vào tài khoản của bạn với nhiều kênh nạp tiền và loại tiền tệ được chấp nhận

  • 3

    Bắt đầu Giao dịch

    Truy cập hàng trăm công cụ trong điều kiện giao dịch hàng đầu thị trường