Markets Start the New Week on a Positive Note!
Last week, the economic calendar was quite busy.
On the Turkish front, the critical Consumer Price Index (CPI) figures were announced at 47.09%, slightly above the expectations of 46.60%. With inflation figures moving upwards, the likelihood of a rate cut may be slightly postponed!
In the U.S., critical data such as PMI, JOLTS, ADP, and Unemployment figures were released last week. The Services Purchasing Managers’ Index came in at 56.1, below the expectation of 57.0. Meanwhile, the JOLTS (Job Openings) data showed job opportunities increasing to approximately 7.744 million, above the expectation of 7.510 million. The ADP figure, an early indicator for Non-Farm Payrolls, was announced at around 146K, below the 166K expectation. The most critical data of the week, Non-Farm Payrolls, came in at 227K, surpassing the expected 202K. However, the unemployment rate increased slightly to 4.2% compared to the previous month. Following the data, the probability of a 0.25 basis point rate cut by the Federal Reserve in December rose to 85%, according to CME Watch.
At the start of this week, news from Asia has fueled strong buying interest in precious metals. On Monday, Chinese President Xi Jinping stated, "We must be fully prepared to achieve next year’s economic goals." Additionally, the Chinese Politburo signaled a "more moderate loose monetary policy," boosting demand for precious metals.
In the U.S. this week, critical data will be released. Especially on Wednesday, the Consumer Price Index (CPI) (YoY) (Nov) and Producer Price Index (PPI) (MoM) (Nov) will play a key role in shaping the Fed's upcoming moves.
On Thursday, the Eurozone markets are almost fully pricing in a 25-basis point (bps) cut in the ECB's Deposit Facility Rate to 3%, as many officials express concerns over the risk of inflation falling below the bank’s target due to weak economic outlooks. The ECB has already cut deposit rates by 75 bps this year, and Thursday's decision would mark the third consecutive rate cut.
Also on Thursday, the Swiss National Bank will announce its interest rate decision, with a 0.25 bp cut widely expected. Overall, the rate-cutting cycles of global central banks continue to drive demand for precious metals!
Meanwhile, geopolitical developments shaping the precious metals market have made for a dynamic start to the week. Syrian opposition leader Abu Muhammad al-Julani met with Assad regime Prime Minister Muhammad Ghazi al-Jalali. Following the meeting, al-Jalali agreed to transfer power to the Syrian Salvation Government, based in Idlib. In the north, the European Council announced the approval of €4.1 billion in financial aid for Ukraine by EU member states.
Additionally, domestic demand, driven by import quotas, continues to cause price discrepancies. At the start of the week, the price difference between global markets and the Turkish market for gold per ounce was around $60.
