{"id":67939,"date":"2023-08-15T16:04:37","date_gmt":"2023-08-15T13:04:37","guid":{"rendered":"https:\/\/ironfx-com.wp-dev.int.theitops.net\/?p=67939"},"modified":"2025-11-19T14:27:05","modified_gmt":"2025-11-19T12:27:05","slug":"gold-fails-to-stop-the-bleeding","status":"publish","type":"post","link":"https:\/\/www.ironfx-cn.com\/vi\/gold-fails-to-stop-the-bleeding\/","title":{"rendered":"Gold fails to stop the bleeding"},"content":{"rendered":"

Gold seems to have continued moving in a downwards<\/strong> fashion<\/strong><\/a>, as we continue to maintain the view that the negative<\/strong> correlation<\/strong> of the USD with gold\u2019s price seems to be maintained and may be the main factor behind the movement of gold\u2019s price currently. In addition, we note the US 10 Year TIPS<\/strong> reaching levels last seen in 2009. We note as the next big test for gold\u2019s<\/strong> price the key<\/strong> psychological<\/strong> level<\/strong> of $1900, as it is currently aiming for that level at the time of this report. In this report, we aim to shed light on the catalysts driving gold\u2019s<\/strong> price, assess its future outlook and conclude with a ph\u00e2n t\u00edch k\u1ef9 thu\u1eadt<\/a>. <\/p>\n\n\n\n

US 10 Year Real Yields reaches levels last seen in 2009.<\/strong><\/h2>\n\n\n\n

The US 10 Year Treasury Inflation-Protected Securities or TIPS for short<\/strong>, at the time of this report appears to have reached<\/strong> levels<\/strong> last seen in 2009<\/strong>. The rise<\/strong> of the US10YEAR TIPS could be attributed to a growing anticipation<\/strong> by market analysts<\/strong>, that the US<\/strong> may see a prolonged<\/strong> period<\/strong> of high interest rates,<\/strong> due persistent<\/strong> inflationary<\/strong> pressures<\/strong>. In particular, the Core CPI rate<\/strong> for July despite coming in lower-than-expected last Thursday, it was still higher<\/strong> than the previous<\/strong> month<\/strong>, indicative<\/strong> of persistent<\/strong> inflationary<\/strong> pressures<\/strong> in the US economy<\/strong>.<\/p>\n\n\n\n

In addition, the Core PPI figures exceeded expectations<\/strong>, further fuelling<\/strong> the theory<\/strong> that prolonged<\/strong> cao<\/strong> interest rate levels<\/strong> may be needed<\/strong>. The persistent<\/strong> inflationary<\/strong> pressures<\/strong> in the US<\/strong>, could potentially<\/strong> allow<\/strong> the Fed<\/strong> to maintain current interest levels or continue hiking<\/strong> should inflation continue to persist, which in turn may have facilitated<\/strong> the decline<\/strong> in the price of gold<\/strong>, as more market participants may opt for the US Treasury bonds<\/strong> which are interest<\/strong> bearing<\/strong>, whereas gold<\/strong> is not.<\/p>\n\n\n\n

Therefore<\/strong>, as the US Treasury bond yields rise<\/strong>, it may not be uncommon<\/strong> to see the price of the precious<\/strong> declining,<\/strong> highlighting their inverse<\/strong> relationship<\/strong>. Lastly, as demand for US Treasury bonds<\/strong> rise, demand<\/strong> for the dollar<\/strong> increases as-well given<\/strong> that they are purchased<\/strong> S\u1eed d\u1ee5ng US dollars<\/strong>, therefore as demand<\/strong> for the greenback<\/strong> increases<\/strong>, the precious<\/strong> which is denominated<\/strong> in dollars<\/strong> becomes more expensive<\/strong> for overseas<\/strong> buyers<\/strong>. Potentially<\/strong> leading<\/strong> to reduced<\/strong> demand<\/strong> for gold<\/strong>, thus weighing<\/strong> on the price<\/strong> of the precious<\/strong>, as the greenback<\/strong> strengthens<\/strong>.<\/p>\n\n\n\n

China\u2019s economic woes and their gold holdings.<\/strong><\/h2>\n\n\n\n

The current economic<\/strong> situation<\/strong> in China<\/strong> poses an interesting<\/strong> question<\/strong>. As we had mentioned in last<\/strong> week’s gold<\/strong> report<\/strong>, China\u2019s gold reserves<\/strong> grew by approximately<\/strong> 23 tons<\/strong> during July, marking 9consecutive months of consecutive buying. Since last week\u2019s report, financial<\/strong> releases<\/strong> stemming<\/strong> from China<\/strong> seem to indicate<\/strong> that the country\u2019s economy<\/strong> has taken a turn<\/strong> for the worse<\/strong>, with the PBOC<\/strong> announcing<\/strong> a surprise<\/strong> interest rate cut<\/strong> on its one-year loans to 2.5%, \u00a0earlier on today and the country\u2019s industrial production and retail sales rates coming in lower<\/strong> than what was expected<\/strong> by market analysts, seems to have highlighted<\/strong> growing<\/strong> concerns<\/strong> about the \u2018health\u2019<\/strong> of China\u2019s<\/strong> economy<\/strong>.<\/p>\n\n\n\n

Therefore, continuing from last weeks assumption<\/strong> that China\u2019s<\/strong> aggressive<\/strong> diversification<\/strong> of reserves<\/strong> may have provided some support<\/strong> for the bullion<\/strong>, the current<\/strong> data could potentially<\/strong> hinder<\/strong> the continuation<\/strong> of China\u2019s diversification<\/strong> attempts<\/strong>, which may have a negative<\/strong> impact<\/strong> on the precious\u2019s<\/strong> price<\/strong>, should demand<\/strong> be reduced<\/strong> thus potentially<\/strong> resulting<\/strong> in the price of gold<\/strong> being pushed<\/strong> to lower<\/strong> ground<\/strong>.<\/p>\n\n\n\n

Ph\u00e2n t\u00edch k\u1ef9 thu\u1eadt<\/strong><\/h2>\n\n\n\n

XAUUSD H4 Chart<\/em><\/strong><\/h3>\n\n\n\n
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