900 dollar brace for weaker gold demand

Beijing medium-term Wu Yunji recent gold market has been a high decline in the trend, the gold price from June 3 nearly 990 U.S. dollars/ounces down to 910 U.S. dollars/ounces, the main factors affecting the gold price decline in the stability of the dollar and the late inflation expectations of the weakening. The current economic situation is not optimistic America's latest report on Non-farm payrolls for June was disappointing. The United States June non-farm employment reduction of 467,000 people, significantly lower than the expected reduction of 363,000 people, the United States June unemployment rate of 9.5%, expected 9.6%. , the highest level since August 1983. The data suggest that the US recession is not over, weakening investors ' expectations of a recovery in the US economy, although the data released are weaker than expected, but the pace of decline in non-farm jobs continues to slow.　　This is a good signal, but the working hours and wages of workers continue to fall, which is not conducive to consumption. In the draft joint statement at the just-concluded G8 meeting, the G8 leaders warned that "there is still a great risk of economic and financial stability" and that the "exit strategy" from the stimulus package should only be lifted after the "determination of the recovery". The G8 meeting is far more cautious about the current economic situation than it did last year when it was a serious underestimate of economic problems. German Chancellor Angela Merkel said, "all countries think the crisis is a long way from the end of the distance, good luck, we have touched the bottom."　　British Prime Minister Gordon Brown said there had been rumours before the meeting that the dollar's status as a major reserve currency might be replaced, but there was no discussion of the issue. Short-term dollar position difficult to shake in general, the G8 summit took a evasive attitude towards the dollar, it also highlights the short-term remains of the U.S. dollar is still hard to shake, governments have a sharp decline in confidence in the dollar, but the world is difficult to find an effective replacement of the dollar currency, so in the short term the reserve status of the dollar is still mainstream, the late dollar fell space limited.　　Recently from the current trend of the U.S. dollar has been formed in the vicinity of 79 to 80 effective support, the latter is expected to further attack 81 to 82 areas. But we also have to note that since the Federal Reserve launched its $300 billion Treasury bond purchase program in March, the market is increasingly worried about inflation concerns caused by the monetization of US debt and the risk of depreciation of the dollar, while the "big buyers" of US Treasuries, China and Russia, have reduced their purchases of long-term dollar assets, which has caused the dollar to suffer severe shocks,　　The dollar is still facing a larger long-term risk. Gold prices will still be under pressure in the short term for gold, the upturn in the economy and the weakness of the dollar, while providing some support for its price, are not enough to bring gold back to the "thousand" high.　　As commodities and financial markets rebound in response to the upturn in the economy, the threat of inflation is not yet apparent and investors are allocating higher-risk high-yield assets to a higher proportion than gold. We see the dollar out of a continuous decline, but the impact on the gold price is not very obvious, the gold price is weaker than the dollar decline, the main reason is related to risk aversion, the early days of the U.S. dollar and gold to become the market concern of the risk-averse species, but with the gradual economic warming,Safe havens are now clearly leaving the dollar market to invest in riskier-return assets such as equities, which is one reason why gold prices have not risen sharply with the dollar.　　With the withdrawal of risk aversion, gold price adjustment pressure gradually increased, in the capital did not return to the gold market, the short-term still the following mainly. From the gold price below 950 U.S. dollars began, basically already announced the impact of the failure of the thousand yuan, upward pressure, gold prices face adjustment in the short term, once again below the 930 dollar is also reasonable, the latter will continue to explore the 900 U.S. dollar pass, the main factor in the rise from the dollar and inflation expectations At the same time, hedge funds in the gold at the important resistance point is not eager to pull up the gold price but opt out of the wait other commodities have also played a role in hedging against inflation, which has discounted its risk aversion in the short term because of its own needs, and is expected to continue for the current round, with 900 of dollars as its main support, Look at the next prop for 880 dollars.