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Hello everyone, today Avatrade Aihua Foreign Exchange will bring you "[Aihua Foreign Exchange Official Website]: Trump said that Iraq and Israel will achieve a full ceasefire, and risk aversion will ease the risk aversion to drag down the gold price." Hope it will be helpful to you! The original content is as follows:
On Tuesday, during the Asian session, spot gold fell because Iran did not take any action to block oil and gas transportation in the Strait of Hormuz, and Iran accepted a ceasefire plan, and the market risk aversion sentiment eased; oil prices fell, and US oil fell nearly 6%, returning to the US$65.00 below the US dollar/barrel, with a low of US$64.38/barrel, the lowest since June 10.
The dollar fell on Monday after the Federal Reserve's vice chairman of financial regulation Bowman said the Fed should consider a rate cut as soon as possible and that market expectations that Iran's response to the U.S. bombing of some of its nuclear facilities will be limited.
Federal Bowman said the timing of a rate cut may soon be as she is increasingly concerned about risks in the job market and less about the inflationary issues of tariffs.
Helen Given, head of trading at MonexUSA in Washington, said, "Bowman is a well-known hawkish person, so any signs of turning to easing and rate cuts she gives will keep the dollar lower."
Feder funds futures are currently priced at a 58 basis point cut this year, indicating that two 25 basis points expected to be a sure thing, and the possibility of a third rate cut is also rising.
Traders raised their bets on more rate cuts after Fed governor Waller said last Friday that the Fed should consider cutting interest rates at its next meeting, July 29-30. Before Waller made the www.avaforexcn.comments, traders had set the rate cut this year at 46 basis points.
Chicago Federal Reserve Chairman Goulsby also said on Monday that the surge in tariffs has had a smaller impact on the economy so far than expected.
The dollar was boosted by the Federal Reserve's "hawkish hold on" last Wednesday, when the Fed kept interest rates unchanged, and Chairman Powell said policymakers expected inflation to rise in the summer due to Trump administration tariffs. Powell will testify before the U.S. Congress on Tuesday and Wednesday.
Asian market
The Japanese private sector rebounded slightly in June, with the www.avaforexcn.comprehensive purchasing managers index rising from 50.2 to 51.4, the highest level since February. The service industry index strengthened, rising from 51.0 to 51.5, leading the rebound. The manufacturing purchasing managers index returned to the expansion area from 49.4 to 50.4.
S&PGlobal's AnnabelFiddes noted that business activity increased at the end of the quarter, but demand remained fragile. New businesses only grew slightly, while foreign demand for finished products weakened further. The www.avaforexcn.company said ongoing concerns over U.S. tariffs and global trade uncertainty continue to put pressure on customer orders and export sales.
Nevertheless, there are signs of easing cost pressure, with input prices rising at the slowest pace in 15 months. Employment has also improved, with the overall rate of employment creation accelerating to the fastest pace in nearly a year.
European market
The UK economy improved slightly in June, with the www.avaforexcn.comprehensive purchasing managers index slightly rising from 50.3 to 50.7, indicating that the economy is expanding in a narrow range. The service industry purchasing managers index rose from 50.9 to 51.3, while the manufacturing industry remained below the 50 threshold, although it increased from 46.4 to 47.7.
S&PGlobal's Chris Williamson described the situation as one of the "lack of good news" activities, with data showing GDP growth rate of only 0.1% in the second quarter. In addition to weak growth, the survey also points to the ongoing uncertainty brought about by recent policy shifts in the UK, global trade frictions and geopolitical instability, including intensifying tensions in the Middle East.
It is crucial that inflationary pressures have cooled significantly due to the above developments. As growth approaches stagnation and inflation slows, the Bank of England's path to cut interest rates again in August is opening up.
The initial PMI value of the euro zone in June is hardly worth celebrating, as the economy continues to step on the water. The www.avaforexcn.comprehensive purchasing managers index (PMI) is stable at 50.2. The manufacturing purchasing managers index (PMI) contracted to 49.4, flat. The service industry index fell from 49.7 to 50.0 mark, barely resuming expansion.
Cyrus dela Rubia of Hamburg www.avaforexcn.commercial Bank said the EU is "working to gain momentum" and both manufacturing and services are showing only trivial progress. Germany shows weak signs of improvement, but France continues to be a drag. Despite this, www.avaforexcn.companies remain cautiously optimistic: the survey shows that employment is generally stable and expectations are slightly improved.
For the ECB, although service inflation remains "slightly tight" due to sticky input costs, this is offset by www.avaforexcn.commodity deflation and the suppression of strong euro and U.S. tariffs. Energy prices (which rebounded due to tensions in the Middle East) could be a problem, although the current PMI data has not yet reflected much of the impact.
U.S. market
Federal Gulsby said there was a lack of significant inflationary pressure since Trump imposed tariffs on April 2, which could allow the Fed to cut interest rates again. He recalled that the Fed expected to lower interest rates at the beginning of the year and suspended interest rate cuts, mainly because of policy uncertainty. "If we don't see inflation caused by these tariff hikes, it seems to me that we have never left what I'm talking about the road to gold before April 2," Goulsby said. He likens the tariffs to "throwing a lot of dust into the air, so it's hard to see if you're still on the road." "If there is no dust in the air, then I think we should continue (rate cuts)."
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