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Weekly Summary (13/12/2021)


CPI rose greatly and gold prices continued under pressure

Spot gold continued to decline last week with the lowest price was reaching 1769, rebounding at the end of the week and was reaching 1788, finally closing at 1782. During the week the main trend was downward and volatile. The fundamentals were mainly affected by the US CPI data in November. The market agreed with the Fed's tightening policy causing the US dollar to flow out of the precious metal market.

According to the CPI data released by the U.S. Department of labor on Friday, the U.S. consumer price index continued to rise which was reaching the fastest speed in 40 years and the economy has the trend of overheating which also makes the market worry about whether the tightening monetary policy of the Federal Reserve will accelerate in advance. The continuous rise of the US dollar index depressed the precious metal market. Although the gold price rose stimulated by the news, the final performance momentum was insufficient, and the market was still weak.

CPI data also shows that commodity prices such as gasoline, housing and food are rising rapidly, which is an important factor to promote the rapid upward floating of CPI index. Central banks of other countries outside the United States are also facing the pressure of rising commodity prices. In the future, the tightening of monetary policy by global central banks will become the mainstream understanding of the market, and the market view will operate on this basis. At the same time, after the US price rise has reached the highest level in nearly 40 years, the Federal Reserve is expected to announce accelerated weight reduction at its meeting next week.The chairman of the Federal Reserve has also made it clear that the factors driving inflation will continue to rise until next year. At present, it is time to adjust the direction through policies.

In terms of epidemic situation, although the new mutant virus is threatening, it can be seen that the epidemic situation does not occupy the main theme of the market. Although there are still new infections, the market should be optimistic about the epidemic situation, and the panic about the impact of the epidemic has been greatly alleviated.

The number of first-time jobless claims in the United States fell to its lowest level since 1969 last week, highlighting that the U.S. labor market remains tight. Data released by the U.S. Department of labor on Thursday showed that the number of first-time jobless claims decreased by 43000 to 184000 in the week ended December 4. The median number of economists surveyed is expected to be 220000. With Americans returning to work and employers trying to retain employees, the number of jobless claims has declined this year.

This week mainly focuses on the Fed's trend and the epidemic situation. Pay particular attention to the Fed's remarks on raising interest rates. It is expected that the market will continue to be dominated by shock downward trend this week.

Technical analysis:

Last week, the price trend was mainly downward and the market momentum was insufficient, showing a weak state. The brin belt channel tilts downward, and the price is basically in the lower track range. It rebounds at the end of the week, and falls after passing through the middle track line and the upper track line. MACD has insufficient kinetic energy, showing an obvious downward trend. At the end of the week it crossed the zero axis and closed with a downward shock trend.

Important quotes this week:

Tuesday: US November PPI annual rate (%)

Wednesday: US retail sales monthly rate in November (%)

Thursday: US December federal funds rate target ceiling (%)

Thursday: US initial jobless claims for the week ended December 11 (10000)

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