Market Drivers – U. S. Session – 11-11-2021

Mohamed Abdelhamid 12 November, 2021 3:07 am Commodities, Forex Market, Global Stock Market, Market Update

Gold has shifted after the latest round of hot than expected U.S. inflation data and here’s what to watch with the latest surge higher.

There’s a fundamental change of language as solid CPI data previously meant faster tapering schedule, consequently lower gold, the new prevalent language has become: strong CPI = some fear, not an acceptance of inflation = higher gold.

Gold closed above $1,835 an ounce level yesterday, but on Thursday, December Comex gold futures are trading at $1,864.00, up 0.85% on the day after rising $35 this week. The shift in the fundamentals came after the inflation rate in the U.S. accelerated to more than 30-year highs in October.
Economic Data
Thursday marks the fourth day in a row that it has posted a fresh daily high with the number of Germany’s new coronavirus cases coming in at 50,196.

U. S. Monthly deficit shrank versus 2020, as government collected more revenue and pulled back on spending.

Data showed consumer price growth in the United States at the fastest annual pace since 1990 last month, and investors believe that the Federal Reserve will respond by raising interest rates faster than its peers in Europe and Japan.

OPEC’s crude oil production rose by 217,000 barrels per day to 27.453 million bpd in October, but still fell short of its share of the 400,000-bpd total output hike of the OPEC+ .

Under the OPEC+ deal, the ten OPEC members bound by the OPEC+ pact should be raising their combined production by 254,000 bpd each month.

Estimates from secondary sources in OPEC’s Monthly Oil Market Report (MOMR) published on Thursday continued to show that it has been undershooting its collective production quota, mostly because of a lack of capacity at some members to pump crude to their quotas.

UK economy grows slower than expected in Q3 despite a September rebound. UK recovery from pandemic lagging G7 and actually slowed to 1.3% in Q3. Service sector led recovery, but manufacturing struggles. The UK faces hard winter amid supply chain problems.

New Zealand’s key sub-indices of production; namely Purchasing Managers’ Index (PMI) for the manufacturing sector (rose to 54.0) from prior reading at 51.4 and New Orders (53.9) were both in positive territory for the first time since July.

Deliveries (59.9) led the way towards catching up on the economic activity, although employment (52.1) fell back to its lowest result since February.

The proportion of negative comments from respondents dropped to 55.4% for October, compared with 71% in September and 78% in August.

Other Developments
The euro declined, Thursday, as the USD rose on the back of the strongest U.S. inflation reading in over 30 years fueling expectations of Fed interest rate hikes next year.

U.S. CPI data showed the biggest gain in four months, lifting the annual increase to 6.2%, the strongest year-on-year rise since November 1990 and following a 5.4% leap in September.

The U. S. dollar pushed the Euro below $1.15, leaving the next major chart support level down at $1.12. Immediate resistance can be seen at 1.1522(38.2%fib), an upside break can trigger rise towards 1.1544.

On the downside, immediate support is seen at 1.1455 (23.6%fib), a break below could take the pair towards 1.1400(Psychological level).
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