Little Changed In Asia

Gold is virtually unchanged, printing $1,837/oz at typing. The precious metal trades a little above two-week lows made earlier in the session, operating within a tight ~$5/oz channel in fairly limited Asia-Pac dealing.

• To recap Tuesday’s price action, gold closed ~$18/oz lower as U.S. real yields broadly rose off of their respective pre-Memorial Day troughs, sealing a second straight month of declines for bullion. The day’s sharpest moves came after the MNI Chicago PMI and U.S. consumer confidence data crossed, with the latter pointing to consumer confidence weakening by less than expected, possibly sapping some demand for the safe haven metal.
• OIS markets are pointing to ~196bp of Fed tightening through the remaining five FOMCs for calendar ‘22, with well-documented comments from the Fed’s Waller’s (calling for “several” 50bp hikes) on Monday continuing to facilitate a limited move higher in tightening expectations.
• Elsewhere, Atlanta Fed Pres Bostic earlier clarified his comments made last week for a September “pause” on rate hikes, stating that it will not translate into a “Fed put”, eliminating already slim expectations from some quarters for a Fed-led market rescue later in ‘22.
• From a technical perspective, rallies in gold are still considered corrective, with the broader trend direction remaining bearish. Resistance is seen at $1,869.7 (May 24 high), while support is situated at $1,807.5/oz (May 18 low) - a break of which would expose further support at $1,787.0 (May 16 low and bear trigger).