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Muhammad Ali – (Cassius Clay) 1942 – 2016
He was an American professional boxer, activist, spokesperson for civil rights and entertainer. Nicknamed “the Greatest“, he is regarded as one of the most significant sports figures of the 20th century and is often regarded as the greatest heavyweight boxer of all time.
Technical analysis indicates that the risk trends towards the upside, with indicators showing overbought conditions and prices rising above moving averages.
However, it’s crucial to remember that markets are subject to change and can be affected by various factors, including geopolitical risks and economic data.
Recent figures indicate that the U.S. Producer Price Index (PPI) increased less than anticipated, which may influence monetary policy decisions and, as a result, the price of gold. Furthermore, the European Central Bank’s (ECB) choice to keep its monetary policy unchanged could lead to a rate reduction next summer, potentially affecting gold prices as well.
Although the present technical perspective suggests a possible continued rise, market fluctuations can occur due to unexpected events or changes in investor sentiment. Consequently, while gold may not face an immediate decline, it is advisable for investors to remain informed and take into account both technical and fundamental aspects when evaluating market trends.
This measure tracks services inflation, excluding food, energy, and housing, which has recently surged, rising 4.8% year-over-year in March 2024 and over 8% on a three-month annualised basis.
The situation is further complicated as some of the most persistent elements of services inflation include essential household expenses such as car and housing insurance, along with property taxes. Wall Street was unsettled by a recent consumer price index report that exceeded expectations, yet the focus is on the ‘supercore’ inflation reading within the data.
Economists also analysed the core CPI, which omits the volatile prices of food and energy, to discern the true inflation trend. The ‘supercore’ gauge goes a step further by also removing shelter and rent costs from its services calculation.
Federal Reserve officials find this measure particularly useful in the current environment, viewing the spike in housing inflation as a transient issue rather than a reliable indicator of underlying price trends.
Supercore inflation accelerated to a 4.8% pace year over year in March 2024, the highest in 11 months.
Adding complexity to the situation is the declining consumer savings rate coupled with rising borrowing costs, which may compel the central bank to maintain a restrictive monetary policy “until something breaks,” according to Fitzpatrick.
Analysts warn that the Federal Reserve may struggle to reduce inflation through additional rate hikes, as the prevailing factors are more persistent and less responsive to stringent monetary policy.