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Title: Gold Price Forecast: XAU/USD prepares for US NFP with a step back to $1,800

December 2, 2022 01:56 AM ET

By: AnalysisWatch

Gold price (XAU/USD) repeats the typical pre-NFP consolidation as it slides from a four-month high to $1,798 during early Friday. In doing so, the yellow metal prints the first daily loss in four amid cautious markets.

In addition to the anxiety ahead of the key US employment data, recent comments from International Monetary Fund (IMF) Managing Director Kristalina Georgieva also seemed to have probed the XAU/USD bulls amid sluggish trading hours. “Recession risks are rising for many countries, the outlook for global growth is exceptionally uncertain and dominated by risks,” said IMF’s Georgieva.

Additionally, fears surrounding the slowdown in the Initial Public Offering (IPO) markets could also be cited as a distant catalyst for the Gold price pullback. “A global slowdown in initial public offerings due to heightened market volatility and a regulatory cloud over new listings from China has created pent-up demand that could lead to an IPO boom in 2023, industry executives told the Reuters NEXT conference.”

Furthermore, the recent comments from New York Fed’s John Williams seemed to have tested the US Dollar bears, as well as favored Gold sellers, as the policymakers stated that the Fed has a ways to go with rate rises.

Amid these plays, the S&P 500 Futures drop 0.30% intraday to 4,070 whereas the US 10-year Treasury yields printed a corrective bounce off the 10-week low to 3.53% by the press time.

It’s worth noting, however, that the dovish concerns surrounding the US Federal Reserve’s (Fed) next move, backed by the downbeat Fedspeak and softer US data, seem to keep the gold bears hopeful ahead of the US employment. Forecasts suggest headline Nonfarm Payrolls (NFP) is likely to ease with a 200K print versus 261K prior while the Unemployment Rate could remain unchanged at 3.7%. It should be noted that a likely easing in the Average Hourly Earnings for the stated month could also weigh on the Gold price.

Title: Oil steady ahead of OPEC+ meeting, EU Russian oil ban

Dec 02, 2022 05:40AM ET

By: AnalysisWatch

Oil futures were broadly stable on Friday, but were poised to end the week up, ahead of a meeting by the Organization of the Petroleum Exporting Countries and its allies (OPEC+) on Sunday and an EU ban on Russian crude oil kicking in on Monday.

Brent crude futures were up 14 cents, or 0.2%, at $87.02 per barrel by 1008 GMT. U.S. West Texas Intermediate (WTI) crude futures inched up 5 cents, or 0.1%, to $81.27 per barrel.

Both Brent and WTI had dipped earlier in the session, but were on track for their first weekly gains - the biggest in two months at around 4% and 6%, respectively - after three consecutive weeks of decline.

Sending bullish signals, China is set to announce an easing of its COVID-19 quarantine protocols within days, sources told Reuters, which would be a major shift in policy in the world's second biggest oil consumer, though analysts warn a significant economic reopening is likely months away.

Also underpinning oil prices, the U.S. dollar, which typically trades inversely with oil, hit five-month lows.

Meanwhile, European Union governments tentatively agreed on a $60 a barrel price cap on Russian seaborne oil with an adjustment mechanism to keep the cap at 5% below the market price, according to diplomats and a document seen by Reuters.

This still needs formal approval before the bloc's sanctions on Russian crude kick in on Dec. 5. Russian Urals crude traded at around $70 a barrel on Thursday afternoon.

Poland, which had pushed for the cap to be as low as possible, had not confirmed that it would support the deal, an EU diplomat said.

OPEC+ is widely expected to stick to its latest target of reducing oil production by 2 million barrels per day (bpd) when it meets on Sunday, but some analysts believe that crude prices could fall if the group does not make further cuts.

That being said, the prospect of subdued Chinese oil demand and more U.S. (strategic petroleum reserve) releases could prompt pre-emptive action by the alliance. Either way, the ingredients are there for price fireworks come Monday morning