Goldman Sachs expects interest rate cut in July
Updated
Last night, Powell mentioned in his speech that he would not wait until inflation fell to 2% before cutting interest rates.
The market was in a frenzy, and even the spot gold market rose to $2,439, then fell back, still not breaking the high of $2,449 in May. But the market's optimistic expectations were opened.
Goldman Sachs even released a report predicting that the Federal Reserve would announce a rate cut at the July interest rate meeting, with three main reasons:
First: The US core CPI rose only 0.06% in June, so it is expected that the US CPI will be further moderate in July and August. In particular, housing inflation data has begun to weaken. Goldman Sachs expects that the June core PCE price index to be released on July 26 will only increase by 0.19% month-on-month.
Second: The unemployment rate in the United States is rising and is close to the turning point. If high interest rates continue to be maintained, the unemployment rate will soar sharply.
Third: The market has fully digested the expectation of a rate cut in September. Now the interest rate market believes that the probability of the Federal Reserve cutting interest rates in September is more than 90%. If the rate cut is clear, it is better to cut interest rates early than late.
However, I think the probability of the Federal Reserve cutting interest rates in July is not very sufficient, and this research report by Goldman Sachs is just to attract the attention of global investors.
Because the interest rate meeting in July is on the 31st, the time is too tight. Such a hasty rate cut, without sufficient preparation for the market, may trigger greater fluctuations in the financial market, and the US dollar index may not be able to bear it in terms of exchange rate.
The Federal Reserve will have four more interest rate meetings this year. It can be said that each interest rate meeting will bring some turmoil to the market, and there is no need to cut interest rates so hastily.
At this stage, some people even believe that a 25BP interest rate cut in September is not enough, and a 50BP interest rate cut will reverse the decline in the job market and prevent a recession.
This expectation is too radical, and the Federal Reserve will certainly not stimulate the market in this way, because the market's overreaction will stimulate inflation again.
Under such strong expectations, the gold price may challenge 2450 again, but the selling pressure is still there, and physical gold investment does not care about the fluctuations of the adjustment again.
But for gold spot traders, the volatility arbitrage space near this is very large. So in the short term, how will the gold price go?
1. From the daily K-line, the gold price has broken through the high point in May. Funds are mostly in a defensive position at this position. From some trading seats, many people are reducing their trading positions, waiting for a breakthrough, or waiting for a sharp decline.
2. At present, it continues to fluctuate at a high level. Today, you can pay attention to the pressure of 2450-55, and you can go short when it is touched for the first time. Pay attention to the support below 2420-15, and maintain a high range of fluctuations today.
The market was in a frenzy, and even the spot gold market rose to $2,439, then fell back, still not breaking the high of $2,449 in May. But the market's optimistic expectations were opened.
Goldman Sachs even released a report predicting that the Federal Reserve would announce a rate cut at the July interest rate meeting, with three main reasons:
First: The US core CPI rose only 0.06% in June, so it is expected that the US CPI will be further moderate in July and August. In particular, housing inflation data has begun to weaken. Goldman Sachs expects that the June core PCE price index to be released on July 26 will only increase by 0.19% month-on-month.
Second: The unemployment rate in the United States is rising and is close to the turning point. If high interest rates continue to be maintained, the unemployment rate will soar sharply.
Third: The market has fully digested the expectation of a rate cut in September. Now the interest rate market believes that the probability of the Federal Reserve cutting interest rates in September is more than 90%. If the rate cut is clear, it is better to cut interest rates early than late.
However, I think the probability of the Federal Reserve cutting interest rates in July is not very sufficient, and this research report by Goldman Sachs is just to attract the attention of global investors.
Because the interest rate meeting in July is on the 31st, the time is too tight. Such a hasty rate cut, without sufficient preparation for the market, may trigger greater fluctuations in the financial market, and the US dollar index may not be able to bear it in terms of exchange rate.
The Federal Reserve will have four more interest rate meetings this year. It can be said that each interest rate meeting will bring some turmoil to the market, and there is no need to cut interest rates so hastily.
At this stage, some people even believe that a 25BP interest rate cut in September is not enough, and a 50BP interest rate cut will reverse the decline in the job market and prevent a recession.
This expectation is too radical, and the Federal Reserve will certainly not stimulate the market in this way, because the market's overreaction will stimulate inflation again.
Under such strong expectations, the gold price may challenge 2450 again, but the selling pressure is still there, and physical gold investment does not care about the fluctuations of the adjustment again.
But for gold spot traders, the volatility arbitrage space near this is very large. So in the short term, how will the gold price go?
1. From the daily K-line, the gold price has broken through the high point in May. Funds are mostly in a defensive position at this position. From some trading seats, many people are reducing their trading positions, waiting for a breakthrough, or waiting for a sharp decline.
2. At present, it continues to fluctuate at a high level. Today, you can pay attention to the pressure of 2450-55, and you can go short when it is touched for the first time. Pay attention to the support below 2420-15, and maintain a high range of fluctuations today.
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