Key events to affect XAU/USD prices (July 08-12)
Every Sunday, I’m posting a weekly list of upcoming financial events and data releases. These are crucial for Gold traders, as they provide insights into economic trends and global bank policies that can have a major effect on the Gold market.
Hello, fellow traders!
Next week we'll be looking at a variety of data from different parts of the world, each with its own influence on the Gold market.
From Germany's trade balance on Monday to the US Producer Price Index on Friday, these indicators will provide insights into economic health and investor sentiment.
Let's dive into the specifics and see what events we should be keeping an eye on:
Monday, July 08
Germany Balance of Trade: measures if Germany sells more than it buys, or other way around.
Why it matters for Gold: A strong trade balance can boost Euro, which might indirectly pressure Gold prices. A weak trade balance could lead to economic uncertainty, potentially increasing demand for Gold as a safe-haven asset.
Tuesday, July 09
Australia's Westpac Consumer Sentiment: measures how confident people in Australia are about their finances and the economy. It's like a survey where people say whether they feel good or bad about spending money.
Why it matters for Gold: When consumer sentiment is high, people may invest more in things other than Gold, like stocks. This can lower Gold prices because Gold is often seen as a "safe haven" investment for uncertain times. On the other hand, when sentiment is low, people may turn to Gold to protect their money, driving up gold prices.
The National Australia Bank (NAB) Business Confidence Index: measures how optimistic or pessimistic Australian businesses are about the economy. It's based on a survey where businesses rate their expectations for economic conditions, profitability, and business activity.
Why it matters for Gold: When business confidence is high, businesses are likely to invest, expand, and hire more employees, which can boost the economy. This optimism can lead to increased spending on riskier assets like stocks, reducing the demand for safe-haven investments like Gold.
Fed Chair Powell's Testimony: hint at future Fed decisions on interest rates or other policies.
Why it matters for Gold: If he hints at raising interest rates, the U.S. dollar usually gets stronger, making Gold less attractive and potentially lowering its price. Conversely, if he suggests lower interest rates, the dollar might weaken, and Gold prices could rise as investors seek safe-haven assets.
Wednesday, July 10
China Inflation Rate YoY: measures how much prices for goods and services in China have increased compared to the same month last year.
Why it matters for Gold: If inflation is high, it means prices are rising quickly. High inflation can make Gold more attractive as a hedge against rising prices, potentially driving up its price. Conversely, low inflation may lessen the demand for Gold, potentially lowering its price.
Fed Chair Jerome Powell Speech: When Powell speaks, his comments can influence expectations about future interest rate changes.
Why it matters for Gold: If Powell suggests higher rates are coming, Gold prices might drop. Hints of steady or lower rates could boost Gold.
Thursday, July 11
The UK GDP MoM: measures the change in the value of goods and services produced in the UK compared to the previous month; an indicator of economic health.
Why it matters for Gold: If GDP is growing, it suggests a strong economy, which can reduce demand for Gold as investors prefer riskier assets like stocks. Conversely, if GDP is shrinking, it indicates economic weakness, increasing demand for Gold as a safe-haven investment, potentially driving up its price.
US Core Inflation Rate MoM: measures the change in the prices of goods and services, excluding food and energy, compared to the previous month. It's a key indicator of underlying inflation trends.
Why it matters for Gold: If core inflation is rising, it suggests increasing prices, which can lead to higher interest rates. Higher rates can strengthen the US dollar and make Gold less attractive, potentially lowering its price.
US Core Inflation Rate YoY: measures the change in the prices of goods and services, excluding food and energy, compared to the same month the previous year. It shows the long-term trend of price increases.
Why it matters for Gold: If core inflation is low, interest rates might remain low, weakening the dollar and making Gold more appealing, potentially increasing its price and vice versa.
US Inflation Rate MoM & YoY: measures how much prices for goods and services in the US have increased compared to the previous month/the same month the previous year.
Why it matters for Gold: If either inflation rate is high, it suggests rising prices, which can lead to higher interest rates, stronger USD, and less demand for Gold.
Friday, July 12
The US PPI MoM: measures the change in the prices that producers receive for their goods and services compared to the previous month; an indicator of wholesale inflation.
Why it matters for Gold: If the PPI is rising, it suggests higher costs for producers, which can lead to higher consumer prices and potential inflation. Higher inflation can lead to higher interest rates, strengthening the US dollar and making Gold less attractive, potentially lowering its price.
The Michigan Consumer Sentiment Prel: an early estimate of how confident American consumers feel about the economy, based on a survey. It reflects their attitudes towards personal finances, business conditions, and spending.
Why it matters for Gold: If consumer sentiment is high, people feel optimistic about the economy and are more likely to spend money, which can strengthen the US dollar and make Gold less attractive, potentially lowering its price. Conversely, if sentiment is low, it indicates consumer worry, leading to increased demand for Gold as a safe-haven investment, potentially driving up its price.
Safe trading,
and remember: All that glitters is not Gold,
Joe