Nicky Shiels, head of metals strategy at MKS PAMP, says now could be a tactical time to buy gold. She argues that the gold market is now showing strength during rate hikes and as the dollar continues to trade near its highest levels since 2002. “Gold made new weekly lows and then highs (after Powell’s presser) in just 45 minutes; something that hasn’t happened on FOMC day in a while,” Shiels said in the note. “Powell was neither hawkish nor dovish, but gloomy; there will be further pain and a soft landing is increasingly unlikely. Not to mention the pace of Fed hikes clearly indicates a clear policy mistake on inflation.”
Business Insider/Theron Mohamed
Bill Ackman says more immigration could help the Fed crush inflation without causing a recession – and touts Russia as a labor source
Boosting immigration could be part of the solution to the Federal Reserve’s problem as it tries to conquer stubborn inflation, Bill Ackman argued in a Twitter thread on Friday.
The US central bank faces the daunting task of cooling US inflation without driving a spike in unemployment, a crash in asset prices, or a slump in the economy.
“Doesn’t it make more sense to moderate wage inflation with increased immigration than by raising rates, destroying demand, putting people out of work, and causing a recession?” the billionaire investor and Pershing Square boss asked.
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Kitco News/Neils Christensen
Gold is so unloved it is becoming immune to Fed’s oversized rate hikes – MKS’ Shiels
The gold market shows relative strength in the face of rising interest rates and a U.S. dollar that continues to trade near its highest level since 2002. Now could be a tactical time to buy gold, according to one market analyst.
In her latest research note, Nicky Shiels, head of metals strategy at MKS PAMP, said that rising economic risks is helping gold find a solid floor around $1,660, even as the Federal Reserve is maintaining its aggressive monetary policy stance as it lowers its growth outlook.
Wednesday, after raising interest rates by another 75 basis points, economic projections from the U.S. central bank signaled that the federal funds rate will peak around 4.6% in 2023. Although interest rates are expected to rise, the Federal Reserve lowered its growth forecasts, forecasting the U.S. economy will grow 0.2% this year and 1.2%, down from June’s projections.
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Which Assets Can Shield Your Portfolio as Geopolitical Tensions Escalate?
A few hours back, Russia’s president Vladamir Putin and his Defence Minister Sergei Shoigu appeared on Russian TV and ordered a partial mobilization of troops which could be a significant move in the ongoing war as Russia keeps on losing its ground for the last couple of weeks. Not just that, Putin also stressed upon using ‘all means’ to protect the integrity of its land and cleared the air of Russia running out of weapons, stating it has a “lot of weapons to reply”.
The US and European leaders are taking it as a warning of a possibility of a nuclear war which has escalated tensions in the global markets. How can you protect your portfolio amid this continued volatility? Definitely, an equity market is generally the first market for liquidation during these tough times as investors want to flee to safety. There are a few assets that are considered to be safe havens when the world goes through major turmoils. Some of them are listed below:
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