Kabuto Takaki Akira "Weekly Gold Market Outlook" January 16, 2023 issue
Kabuki Takashi, the representative director and president of Investment Daily Co., Ltd., and a master of cycle analysis, writes a weekly report on the outlook for gold prices.
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On the 12th, the U.S. consumer price index showed that the inflation deceleration trend remains, rising 6.5% year over year, marking the slowest pace in 1 year and 2 months since October 2021. Following the announcement, markets priced in a 0.25 percentage point rate hike at the next FOMC meeting. According to CME Group FedWatch, the market currently has priced in a 0.25% rate hike at the next FOMC meeting at 94%. U.S. financial giants note, “There are signs of cooling, but CPI remains too high. The path to a decline remains too uncertain” (Wells Fargo). Some caution that even if the rate hike for February is compressed to 0.25%, it does not imply a lower terminal rate for policy rates.
In response to the CPI release, the dollar index accelerated its decline last week, dropping from the 105 range to below 102. However, the U.S. 10-year yield remains around last December’s level (around 3.4%).
From a chart formation perspective, it remains to be seen whether a double bottom can form, but as noted by Wells Fargo, the path to lower interest rates is still unclear, and the rate-hiking stance has not changed. The dollar index appears to be leading the move more than interest rates, likely due to a large impact from drops in the USD/JPY rate.
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【Takashi Kabuki – Profile】
Graduated from Kansai Gaidai University, Faculty of Economics. In 1995, partnered with the world-renowned U.S. market analyst Raymond Merriman to publish the domestic first market cycle and astrology report. Renowned for cycle and astrology-based market analysis. Representative Director of Investment Daily Co., Ltd., Representative Director of Investment Daily Publications Co., Ltd., Director of Wakabayashi FX Associates, Member of the Japan Technical Analysts Association, Editor-in-chief of Investment Daily α.
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