Daily digest market movers: Gold price stays firm amid steady US Dollar, falling US yields
- Gold prices remain underpinned by lower US Treasury yields and a softer US Dollar. The US 10-year Treasury note is yielding 4.579%, down five basis points (bps) from its opening level. The US Dollar Index (DXY), which tracks the Greenback’s performance against six other currencies, edged down 0.23% and is at 105.39.
- The US Trade Balance data revealed a slight narrowing of the deficit by -0.1%, moving from $69.5 billion to $69.4 billion, which fell short of the expected $69.1 billion. This change was due to a -1.6% decrease in imports, which totaled $327 billion, and a -2.0% decline in exports, which dropped to $257.6 billion.
- Additionally, the US Bureau of Labor Statistics (BLS) reported that US Initial Jobless Claims for the week ending April 27 remained steady at 208K, unchanged from the previous week and lower than the anticipated 212K.
- On Wednesday, the Fed decided to keep the fed funds rate unchanged at 5.25%-5.50 %. They acknowledged that risks to achieving the Fed’s dual mandate on employment and inflation “moved toward better balance over the past year.” Although they said there’s progress on inflation, recent data showed that it has stalled.
- Fed policymakers added that they would begin reducing their balance sheet holdings of US Treasury securities from $60 billion to $25 billion starting in June.
- On May 3, the US Bureau of Labor Statistics (BLS) is expected to reveal April’s Nonfarm Payrolls figures, which are expected to come at 243K, below March’s 303K. The Unemployment Rate is estimated to stay at 3.8%, while Average Hourly Earnings would likely remain unchanged at 0.3% MoM.
- Data from the Chicago Board of Trade (CBOT) suggests that traders expect the fed funds rate to finish 2024 at 5.045%, down from 5.100% on Wednesday.
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