Daily digest market movers: Gold shrugs off hot US CPI report, resumes uptrend
- The March US Producer Price Index (PPI) showed that the disinflation process continues, with data clocking at 0.2% MoM, below estimates of 0.3%. The core PPI printed at 0.2% MoM, which is below estimates and February’s reading.
- In the twelve months to March, the PPI rose by 2.1%, less than projections but surpassing February’s 1.6%. The core PPI stood at 2.4%, however, above estimates and the previous month's data.
- Initial Jobless Claims for the week ending April 6 dipped from 222K to 211K, below estimates of 215K, reinforcing the labor market's robustness following last Friday’s release of the Nonfarm Payrolls report.
- High inflationary levels in the United States, revealed by the March Consumer Price Index (CPI) report, prompted investors to trim expectations of the Fed’s rate cuts.
- Data from the Chicago Board of Trade (CBOT) suggests that futures traders expect just two cuts to the fed funds rate as they project the main reference rate to end the year at 4.955%.
- Despite that, the fall of US Treasury nominal and real yields is a headwind for Gold prices. US real yields fall three basis points to 2.148%.
- The US Dollar Index (DXY) also witnessed a substantial increase, soaring over 1% to reach new YTD high of 105.27.
- World Gold Consortium reveals that the People’s Bank of China was the largest buyer of the yellow metal in February, increasing its reserves by 12 tonnes to 2,257 tonnes.
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