DAILY ANALYSIS

Morning Review - First Gold July 09, 2019: Keeping an eye on Jerome Powell's testimony, the gold held down

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The China Paper Gold Network shows that funds are traded on the world's biggest gold exchange (ETF) until July 9, holding 795.8 tons, up 1.17 tons from the previous day, and a net reduction of 1.76 tons this month.
 
The US ADP employment data released on Wednesday (July 3) was less than expected, with only a 102,000 increase, far lower than market expectations of 160,000. After a weak report was released, gold rose to the highest level in one day.
 
The June ISM non-manufacturing PMI released on Wednesday (July 3) was 55.1, lower than the previous value of 56.9 and estimated at 55.9, the lowest since July 2017, indicating that economic growth slowed, but not down shift like a cliff type.

On Wednesday (July 3), US factory orders in May were -0.7%, higher than the previous value of -0.8% but lower than expected -0.5%; comments said that new orders for US-made goods fell in the second month. Shipments have barely increased, indicating that the manufacturing sector continues to be weak. The US Commerce Department said Wednesday that factory orders fell due to weak demand for transportation equipment. Manufacturing industries dragged down by stockpiles, trade tensions and a decline in production of Boeing 737 aircraft Max.
 
According to information released by the US Department of Labor on Friday (July 5), US non-farm payrolls increased 224,000 in June, significantly better than the estimated 160,000, with the previous value of only 75,000. At the same time, the unemployment rate rose to 3.7%, and the annual salary level was steady at 3.1%.
 
On Wednesday (July 3), the final value of the June Markit US service PMI was 51.5, higher than previous values ​​and expectations, Head of Business Economics Markit Chris Williamson said manufacturing and service PMI data implies that the US economy is growing at an annual rate. Will increase by 1.5%, growth in the service industry has increased.

The US core PCE price index for May released on Friday (June 28) is 1.6%, according to the previous value and expectation value, the effect on the market is very small. US personal monthly expenditure in May was 0.4%, higher than the previous value of 0.3%, but in line with expectations. The agency's agency commented that US consumer spending increased moderately in May, and prices rose slightly, indicating that economic growth slowing and mild inflationary pressure. For this reason, it is possible for the Fed to cut interest rates next month.
 
The final value of the US Consumer Confidence Index for the University of Michigan in June (June 28) was 98.2, surpassing the previous value of 97.9 and market expectations 98; The small overall decline in June was caused entirely by households with income in the top third of the distribution, which more often mentioned the negative impact of tariffs, recorded 45%, up from 30% last month, "said Consumer Survey chief economist Richard Curtin.
 
Mitsubishi said on Monday that Fed Chair Powell's testimony at the Congress this week could increase the price of gold. In recent weeks, the moderate Fed has signaled that interest rate cuts have weighed on US Treasury yields, making non-financial assets such as gold more attractive to investors. The dollar also began to weaken and support gold. Mitsubishi said, "If the Fed finally postpones the rate cut this month has been waiting for, in part to show its political independence from the White House, the return on yields can soar and put pressure on gold." "The direction of the Fed's future development is further hints can appear in congressional testimony from Chair Powell on Wednesday and Thursday at the meeting of the Fed's Minutes of Meeting on Wednesday."

On Wednesday, Chairman of the Federal Reserve Powell will visit the Senate to give a speech on US monetary policy, and the market is very concerned. There is no main data released on Monday, and the US dollar index continues to rise, running above 97; Spot gold fell slightly on the day and continued to run below the 1400 mark.