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Gold and silver are trading marginally lower leading into the European open after a dismal session on Tuesday. Hawkish comments from Janet Yellen sent the yellow metal lower to trade -0.77% in the red during yesterday's session. Silver also moved -1.47% in the red and trades at $2635/oz this morning.
Japanese, Chinese, and South Korean markets were still closed due to public holiday's but the ASX rose 0.39% despite a negative lead from Wall Street. Some analysts attributed the gain to Yellen clarifying her earlier statement by saying she was not predicting or recommending a rate rise.
In FX markets, the dollar index was slightly firmer overnight after rising 0.35% in the prior session. The main mover has been NZD/USD 0.13% but the majors mostly traded within their ranges overnight. In the rest of the commodities complex copper is trading -0.11% lower and spot WTI moved 0.16% higher.
Looking at the news, Treasury Secretary Janet Yellen says she has regular meetings with Fed Chair Powell but believes strongly in Fed independence and she also reiterated "She Isn’t Predicting Higher Interest Rates". On the subject of cryptocurrencies, Yellen said we don't have an adequate cryptocurrency regulatory framework.
On the coronavirus front, a third COVID-19 vaccine shot will be offered to people over 50 in the UK.
Looking at some of the data overnight, New Zealand ANZ Commodity Price index for April +2.3% m/m (prior +6.1%) - NZ jobs report for Q1 showed the Unemployment rate hit 4.7% (vs. 4.9% expected).
In Australia, April construction PMI printed at 59.1 (vs. prior 61.8) and Australia April Markit PMIs, saw at services 58.8 (prior 55.5) & composite rose to reach 58.9 (prior also 55.5)
From central bankers, Fed's Kashkari says the Federal Reserve has powerful tools if inflation surprises higher.
Dallas Fed head Kaplan said yet again that a discussion of tapering should begin. This is not the first time Kaplan has stated that the Fed should start to look at tapering QE.
Lastly, RBNZ Deputy Governor Bascand says there is a greater risk of a house price correction. This comes after the RBNZ tightened lending rules.
Looking ahead to the rest of the session highlights include composite and services PMI's from the major nations, EU PPI, U.S. ADP NFP, and weekly DoE's. We could also get comments from Fed's Rosengren, Kaplan, Evans, Mester, BoC's Macklem, ECB's Lane, German Buba's Wuermeling, and BoE's Deputy Governor Woods.
By Rajan Dhall
For Kitco News
