Gold is stable on Wednesday, as the pair trades at $1284.27 per ounce in the European session. It's a quiet day on the release front, with no major releases out of the US. On Tuesday, the Russian and Ukrainian presidents met as the crisis in eastern Ukraine continues.
There are hopes for some progress in the Ukraine crisis, as Russian president Vladimir Putin met with his Ukrainian counterpart Petro Poroshenko in Minsk on Tuesday. The meeting was discussed as "positive", but fighting between Ukrainian forces and pro-Russian militants continues. The crisis has plunged relations between Russia and the West to their lowest levels since the Cold War. Europe and the US have imposed sanctions and Moscow has been quick to retaliate. The impasse could hurt countries such as Germany, which have strong trade ties with Russia.
US durables painted a mixed picture on Tuesday. Core Durable Goods Orders, a key indicator, came in at -0.8%, its worst showing in 2014. This was nowhere near the estimate of +0.5%. At the same time, Durable Goods Orders stunned the markets with a record gain of 22.6%. The reason? A huge increase in the purchase of passenger planes in July. Meanwhile, the CB Consumer Sentiment looked sharp, pointing to strong optimism on the part of the US consumer. The indicator jumped to 92.4 points, up from 90.3 a month earlier.
There was some speculation that the financial meeting in Jackson Hole might be a market-mover, so the markets were all ears as Fed chair Janet Yellen delivered the keynote address on Friday. Any hopes for some dramatic news were dashed, however, as Yellen did not provide any clues as to the timing of a rate hike. She reiterated that the US job market still needed to improve, so employment numbers remain a crucial factor in any rate move by the Fed. There is a clear divergence in monetary stance between the ECB and the Fed, as the Fed is winding up QE, while the ECB may be forced to provide stimulus to the sagging Eurozone economy.
XAU/USD 1286.84 H: 1290.83 L: 1275.82
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