Gold price today July 20: Recovering 'fast', about to hit $2,000

Home sales fell 8% to 1.43 million units last month, the Commerce Department said. The number was lower than expected when economists forecast 1.48 million units. The report also emphasized, the housing market outlook is less positive as the number of construction permits fell more than expected.

The housing market struggled as interest rates rose. At the same time, the low supply of houses for sale causes prices to rise, many people do not have enough money to buy houses.

Besides, US government bond yields fell for two consecutive sessions.

Disappointing economic data helps the precious metal hold support around $1,980 an ounce. The gold market saw technical profit-taking after prices rallied to a six-week high.

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Gold price is always sensitive to US interest rate adjustments. Jim Wyckoff, market analyst at Kitco, said that the price of gold could rise to $2,000 an ounce if the Fed stops its rate hike cycle after another hike this month.

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Many investors expect that the US Federal Reserve (Fed) will continue to raise interest rates one last time in its meeting on July 26, with an increase of 0.25 basis points, then will keep maintain this interest rate until inflation falls to the target level of 2%.

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According to Kitco, it is likely that the Fed is about to end the cycle of tightening monetary policy because inflation seems to be under control. Accordingly, the USD will enter a bearish phase and gold will often move in the opposite direction.

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Accordingly, the IMF believes that global economic activity is slowing down, especially in the manufacturing sector

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Inflation tends to decrease, but basically remains at a high level. This could cause central banks to continue stretching, or raise interest rates more to curb inflation. Rising interest rates will be a challenge for economic growth.

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Experts said that the weakening economy will increase risks for investment cash flow. This is a positive support factor for gold when investors have to seek shelter in cash flow.

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Not a lot of key US macroeconomic data is out this week, but Thursday's initial jobless claims weekly data still holds investors' attention. .

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The precious metal initially rallied significantly on Tuesday as data showed U.S. retail sales rose less than expected in June, suggesting consumer inflation has slowed. may be less severe than anticipated.

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Any sign of a pause in the Fed's rate hike cycle is good news for non-yielding assets like gold, which has been hit by rate hikes over the past year.

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Dovish signals from the European Central Bank and the Bank of England also boosted gold's appeal, as well as increasing safe-haven demand amid worsening economic growth in China.

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On Wall Street (USA), the Dowjones, S&P 500 and Nasdaq stock indexes had significant gains for the third consecutive day, stimulating investors to put capital into stocks.

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USD rose against most major currencies, especially GBP (inflation fell below 8% for the first time in over a year), AUD and JPY. The DXY index is back above 100, however, there was a retracement from the top during the session.

הערה:

In the trading session of July 19, VN-Index ended a series of 8 consecutive gaining sessions. At the end of the session, the VN-Index dropped 1.11 points to 1,172.98 points. HNX-Index increased 0.51 points to 231.47 points. UPCoM-Index increased 0.11 points to 87.14 points.