cairo- 13/3/2023
The General Division for Gold and Jewelry of the General Federation of Chambers of Commerce monitored a set of indicators that will have a direct impact on the rise in gold prices in the global and local markets, on top of which was the fall of the “Silicon Valley Bank – SVB” at the end of last week, which experts see as the largest banking failure in the United States of America since the financial crisis major events in 2008, which led to a new rise in the gold market with expectations of the US Federal Reserve easing its strict policy to contain inflation rates, which was behind the impact of the US banking system, not just the Silicon Valley bank. The European stock exchanges, led by the Frankfurt Stock Exchange, also witnessed a collective decline during the past week, in addition to the continuation of a number of countries towards increasing their reserves of gold, which created an increasing global demand for the precious metal – which confirmed that it is a safe haven to protect investors from inflation and possible financial turmoil in global markets – to a rise. Its prices ended last week and confirms the trend of prices going up the week before.
Many analysts confirmed that the collapse of the “SVB” in addition to the decline in shares of major US banks, It may be the end of the US Federal Reserve’s hawkish policy, All the reports issued since the beginning of the global inflation crisis – which came with the imposition of economic sanctions by the United States and the European Union on the Russian Federation – indicated that the US Central Bank will not back down from its aggressive monetary policy until the negative effects of that policy begin on the US banking sector on the one hand and the markets are directed at a linear pace. fast towards a general state of stagnation.
Many indicators came positive for gold prices, as all reports confirm that it is unlikely that the Federal Reserve will be able to raise interest rates to 6%, with expectations that interest rates will reach their peak. Especially with two-year bond yields down nearly 40 basis points last Friday from their highs.
Opinion polls of Wall Street and Main Street analysts also revealed a consensus of about 60% of the participants that gold prices are going to rise, and many of them see the possibility of the price of an ounce reaching between 1880 to 1900 dollars during the next week, with anticipation of inflation data expected to be issued this week with the issuance of Consumer price index, which may have a temporary negative impact on gold prices.
On the other hand, last week’s jobs report was disappointing. While 311,000 new job opportunities were provided, this figure does not cause optimism compared to what was made available during last January, which was estimated at about 517,000 job opportunities. The unemployment rate increased for the month of February by 0.1%, to reach 3.6%, compared to 3.5% in January, which are indicators. Others call for making sure that there is intense pressure on the US Federal Reserve to ease its strict policies and invite analysts to believe that the next decision of the US Federal Reserve will not witness an interest rate hike of more than 25 basis points only.
