Gold investment: decline more than short ceaseless! The Bank of Japan warns! Dollar index or ride out the dust! Gold price may plunge to 1828!

Spot gold continued to come under pressure in Asian trading on Thursday, trading near $1,858. Silver, meanwhile, fell as much as 4.01 percent on the day to rebound to $22.16 an ounce. The DOLLAR index was little changed at around 94.40. Spot gold fell $35.76, or 1.88 per cent, to $1,863.05 an ounce, its lowest close in two months, after touching an intraday low of $1,905.16 and a high of $1,855.00. The dollar index.DXY closed at 94.37, up 0.41 percent, after hitting an intraday high of 94.44 and a low of 93.93.

At 07:50 Beijing time, the Bank of Japan released the minutes of its July monetary policy meeting. Some central bank policy reviewers warned that a resurgence of coVID-19 could delay Japan’s economic recovery and destabilize the banking system by letting more companies fail. While they agreed to boost stimulus if necessary, boj policymakers said the impact of the outbreak on financial institutions’ profits could weaken their ability to boost lending, the minutes showed.

“The number of coVID-19 infections is accelerating globally, so we need to be alert to the possibility of a resurgence, including in Japan,” the minutes quoted several commissioners as saying.

“If the number of infections rises again, the timing of economic recovery could be pushed back,” one member said. Another member said the impact of the epidemic, if sustained over a long period of time, could lead to increased unemployment, hurt household incomes and cool consumption.

While the bank of Japan kept monetary policy on hold in its July rate review, the comments highlighted the lack of confidence among policymakers in their modest expectations for an economic recovery. “Members considered that financial intermediation could be weakened if the profits of financial institutions were under prolonged pressure,” the minutes said. Under a policy known as “yield curve control,” the boj kept short-term interest rates at minus 0.1 percent and 10-year bond yields around zero to meet its 2 percent inflation target.

So far this year, the bank of Japan has eased policy twice, such as expanding asset purchases and setting up a lending facility designed to ease corporate financing pressures, to cushion the impact of coVID-19. Some members said the boj should continue to focus on easing financial strains and turn its attention to meeting price targets only when the outbreak was under control, according to the minutes.

Fundamental positive factors

  1. According to Worldometers’ real-time world statistics, as of 7:53 am September 24, the total number of confirmed cases of COVID-19 worldwide has exceeded 32,02.07 million, reaching 32,074,791, and the total number of deaths has exceeded 980,000, reaching 980,902. The United States has the world’s highest cumulative number of confirmed COVID-19 cases, with 7.13 million cases reaching 7,136,700. The cumulative number of deaths has exceeded 206,000, reaching 206,527.
  2. Taiwan media Liberty Times reported that Taiwan’s defense ministry released information that PLA aircraft re-entered the southwest airspace on September 23. It was also the sixth time in seven days that PLA aircraft had flown in airspace around Taiwan. Two YO-8 anti-submarine aircraft of the People’s Liberation Army (PLA) entered Taiwan’s Air Defense Identification Zone (ADIZ) from south of the southernmost point in the middle Route of the Taiwan Strait on Monday, following a similar path as the previous days. As usual, the Army scrambled fighter jets and used anti-aircraft missiles to track and monitor PLA aircraft. The defense ministry also released photos taken by the Taiwanese military of one of the PLA Y-8 anti-submarine aircraft.
  3. U.S. Secretary of State Mike Pompeo warned U.S. state and local politicians on Wednesday to be wary of Chinese diplomats, who he said may be trying to woo them as part of Chinese propaganda and espionage. He also called for more cooperation with Taiwan. Speaking at the Wisconsin state Capitol, he said the State Department is reviewing the activities of the U.S.-China Friendship Council and the China Council for Peaceful Reunification because of suspicions they are trying to influence U.S. schools, business groups and local politicians. He said the two groups have ties to the United Front Work Department of the CPC Central Committee.
  4. The US House of Representatives on Tuesday overwhelmingly approved a bill that would effectively ban IMPORTS of US products from China’s Xinjiang Uygur Autonomous region over alleged use of government-backed forced labor. The new law, passed on Tuesday, means that importers cannot purchase all or part of the products produced in Xinjiang unless the US government can show “clear and convincing” evidence that they were not produced with forced Labour. Lawmakers voted 406 to 3 in favor of the bill, called the Uygur Forced Labour Prevention Act.

Technical analysis:

Gold: The gold price closed down again overnight and moved below 1860. The current turning point is 1882, which is far away from the current price. RSI technical index is bearish and has room for further decline, moving towards 1841.25 on the day, and if it falls below 1828.

Silver: Spot silver has been hit again, and now it has broken the first target of 22.15. RSI technical index shows the trend of further decline, and the next move is towards 21.34.

Fundamentals negative factors

  1. CDC Director Redfield said at a Senate Health Committee hearing Wednesday that he was not suggesting last week that there would be enough novel Coronavirus vaccine available for all Americans by the second half of next year. Redfield said there should be about 700 million doses by April, echoing the timeline given last week by Paul Mango, deputy chief of staff at the Department of Health and Human Services.
  2. Panjiva, the global market research arm of S&P, said on Tuesday that US pork exports to China had surged past pre-trade levels thanks to higher shipments from Brazil’s JBS SA and America’s Smith Smith Foods owner WH Group. Panjiva said on Tuesday that JBS’s exports of US pork to China this year as of August 31 were likely to be up 370 per cent from the same period in 2017, while wh Group’s exports were up 90.1 per cent.

3.China and India said On Tuesday they had agreed to stop sending more troops to a Himalayan hotspot near their disputed border and to refrain from any action that could complicate tensions in the region. Wu Qian, a spokesman for China’s defence ministry, said senior military officials from the two countries met on Monday and exchanged views on the border dispute. In a joint news release issued by the Indian government in New Delhi, the two sides agreed to “avoid misunderstanding and miscalculation” and to “refrain from unilaterally changing the situation on the ground”. “The two sides also agreed to hold a seventh round of military commander-level meetings as soon as possible,” the news release said.

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