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Free AccessStronger On Back Of PPI Data & Middle East Tensions
Gold is 0.3% higher in the Asia-Pac session, after closing 1.0% higher at $2049.06 on Friday.
- The move higher was assisted by lower-than-expected PPI data. US producer prices decreased 0.1% in December compared with expectations for a 0.1% increase. This saw the annual rate for headline and core prices at 1% and 1.8% respectively. Ex Food and Energy were lower than expected as well. The PPI report more than offset the impact of Thursday's slightly hotter CPI.
- Short-end US Treasuries held richer into Friday’s close, indicative of higher projected rate cuts through mid-2024: March 2024 chance of a rate cut was 77% w/ cumulative of -20.9bp at 5.120%, May 2024 was fully pricing in 25bp cut now, cumulative -50.1bp at 4.828%. June 2024 has cumulative -80.4bp at 4.525%.
- Some haven demand also provided support for US Treasuries amid increased worries over tensions in the Red Sea after the U.S. and U.K. attacked Houthi targets in Yemen.
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.