On June 19th, a significant rebound in the Philadelphia Fed Manufacturing Index for June continued to exert downward pressure on gold prices.
ZFX Shanhai Securities noted that the data improved from a negative reading in the previous month to 10.3, surpassing market expectations, indicating a recovery in manufacturing activity and order performance. This has further reduced market bets on a swift return to accommodative monetary policy.
Gold prices were already oscillating under the backdrop of tighter interest rate expectations, and the improvement in macroeconomic data has further eroded the dual support from safe-haven demand and potential rate cuts.
ZFX Shanhai Securities believes that when sub-indices like new orders, shipments, and employment improve simultaneously, the market is more inclined to view gold as an asset awaiting new catalysts, rather than an immediate destination for capital inflows.
For precious metals, the current pressure primarily stems from the combined effect of real interest rates and the US dollar. As long as economic data remains resilient, gold may maintain a weak consolidation pattern at elevated levels in the short term.
If subsequent data from other regions continues to align with this trend, the pace of any gold price recovery is likely to remain constrained.
Looking ahead, ZFX Shanhai Securities anticipates the market will continue to trade based on US economic data, Federal Reserve communications, and the direction of the US dollar. Whether gold can re-establish itself in a higher trading range will depend on whether new marginal changes emerge in the macroeconomic data.
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