Strong Rally On Back Of Declines In USD & Bond Yields

Gold is slightly stronger in the Asia-Pac session, after closing +1.0% at $1915.48 on Wednesday. Bullion benefited from the sharp reversal of recent USD strength and a large rally in US tsys.

• US tsys strengthened in the European session as European bonds reacted to weaker-than-expected Euro Area PMIs. US tsys then extended gains after flash US PMIs printed softer than forecast, with technical flows and position squaring adding a level of support through the session. US tsys finished 8-13bps richer across the major benchmarks.
• The pivotal economic event of this week centres on the speech by Fed Chair Powell at the Jackson Hole gathering on Friday. The prevailing concern is that Powell might undermine investors' optimistic expectations, specifically the notion that the Federal Reserve has concluded its interest rate hikes and is poised to initiate rate cuts in the early months of the upcoming year.
• According to MNI's technicals team, Wednesday’s high of $1920.40 cleared resistance at $1916.3 (20-day EMA) to open $1932.7 (50-day EMA).