01
It was reported in mid-August Feder will continue to significantly rate hike , and the price of gold plummeted, and at its lowest point was set in the mid-day session of September 28, a new low of $1,622.2.
Then the price of international gold rebounded for a short time, but continued to fall since October 5th. Today, the lowest price intraday reached US$1,626.3, only one step away from the last low. If nothing unexpected happens, this decline will create a lower low.
In fact, if we look at the trend of international gold prices this year, we will find that since it exceeded US$2,000 in March, the price of gold has been getting lower and lower in the continuous fluctuations. The high point of each rebound is lower than the previous high point, and the low point set by each decline is lower than the previous low point. Gold is in a clear downward trend.
USD raising interest rates continuously, and USD index continues to strengthen, which is an important factor in suppressing gold prices.
02
From last week to this week, many large banks have released their financial reports. We can also see that these large financial institutions have predicted that the US economy will enter a recession, and they are all preparing for a future recession. Is it a good choice to configure gold when
recession?
For several months, the U.S. inflation expectations have not improved. In September this year, the consumer price index actually rose by nearly 8.2% compared with the same period last year.
Outsiders criticized that the Fed's series of radical interest rate hikes will not help suppress inflation, but will instead trigger an unnecessary deep recession in the US economy.
Now, Wall Street major banks are becoming increasingly confused about the future prospects of the United States.
In the report, executives of these six banks all the same said that they are preparing for a future recession, the most important of which is to strengthen management of loans that have been issued and withdraw more loan loss reserves.
Industry insiders said that the last time the reserve loan loss reserve was strengthened on such a large scale was in the early stages of the epidemic.
At that time, the major banks were doing it to invest these tens of billions of dollars in loan loss reserves, but most of the funds had been released in 2021.
Now it seems that the situation in 2023 may be worse than in the early stages of the epidemic.
03
But it may be different from what many ordinary investors think. Neither these large investment banks nor other large financial institutions have prepared more gold for the recession.
This period of data actually shows that gold ETF of Western countries has been continuously reducing holdings.
high inflation , under the shadow of the economic recession, gold loses its traditional risk aversion function. The main reason is that in the past 10 years, Western countries led by the United States have injected too much liquidity into the market.
It seems that it is difficult for gold prices to have room for growth before the Fed stops hikes.
