(Kitco News) - Gold prices are modestly down in early U.S. trading Friday, as the marketplace is squarely focused on Federal Reserve Chairman Jerome Powell’s speech in Wyoming, set to begin soon. December gold was last down $11.00 at $3,370.70. September silver prices were down $0.174 at $37.905.
The Kansas City Federal Reserve’s annual Jackson Hole central banker symposium is in progress and the highlight is a speech this morning by Powell. He is expected to update the Fed's monetary policy framework. Powell could provide a new perspective on how much FOMC support there is to lower U.S. interest rates in September. Bond traders expect Powell to indicate Fed policymakers will start cutting interest rates next month. However, his speech may remind traders and investors that any rate cut in September depends on the next round of employment and inflation reports. Jason Pride, head of investment strategy and research at Glenmede, said Powell will probably suggest that the U.S. economic data has weakened enough to support consideration of a rate cut, according to a Bloomberg report.
Global stock markets were mixed to higher overnight. U.S. stock indexes are set to open firmer when the New York day session begins.
In other news, ECB officials are increasingly convinced they can keep Eurozone interest rates unchanged in September, according to people familiar with the matter who don’t see the trade deal between the EU and U.S. causing major economic concerns, according to Bloomberg. Since ECB rates were left at 2% last month, growth and inflation have developed largely in line with the ECB’s June outlook, said the people, who also said the ECB foresees price pressures dipping in 2026 before hitting the 2% goal again in 2027.
China’s Shanghai composite index surged 1.45% to close at 3,826 on Friday, while the Shenzhen Component rallied 2.07% to 12,166, with the former scaling a new decade high as strong fund rotations and retail buying fueled the rally. Chinese equities have advanced sharply in recent weeks as investors shifted out of bonds into stocks, with margin financing climbing to levels last seen during the 2015 bull market. Sentiment has also been underpinned by easing US-China trade tensions and Beijing’s moves to curb excessive competition, even as domestic economic data remain weak and policy support relatively modest. For the week, the Shanghai composite index rose 3.49% and the Shenzhen component index gained 4.57%.
The key outside markets today see the U.S. dollar index slightly up, with crude oil prices slightly up and trading around $63.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.337%.
There is no major U.S. economic data due for release Friday.
Technically, December gold futures bulls have the overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $3,500.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the July low of $3,319.20. First resistance is seen at $3,400.00 and then at this week’s high of $3,403.60. First support is seen at this week’s low of $3,353.40 and then at $3,350.00. Wyckoff's Market Rating: 6.5.
September silver futures bulls have the overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the July high of $39.91. The next downside price objective for the bears is closing prices below solid support at the July low of $36.28. First resistance is seen at this week’s high of $38.34 and then at $38.875. Next support is seen at $37.50 and then at this week’s low of $36.96. Wyckoff's Market Rating: 6.5.
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