February 8th Financial News

Daily News

Summary:

French parliament adopts 2025 budget, aiming to reduce the public deficit ratio. Tim Laursen: The January employment report is unlikely to change the Fed's wait-and-see attitude...

[Quick Facts]

1.French parliament adopts 2025 budget, aiming to reduce the public deficit ratio.

2.Germany's industrial output in December fell to a more than four-year low.

3.Non-farm payrolls: A green light for the Federal Reserve to maintain its current stance?

4.Tim Laursen: The January employment report is unlikely to change the Fed's wait-and-see attitude.

5.Philip Lane: Caution advised on focusing too much on the neutral interest rate.

[News Details]

French parliament adopts 2025 budget, aiming to reduce the public deficit ratio

The French parliament on Thursday finally adopted the state's 2025 budget in the final vote, bringing an end to the prolonged budgetary limbo that has persisted since the end of last year. This development also marks a temporary resolution to the long-standing political turmoil surrounding the budgetary delays.

Under the terms of the budget draft, the French government has set a target to reduce the public deficit to 5.4% of GDP in 2025. Previously, the government had projected that the public deficit would stand at approximately 6.1% of GDP in 2024. To achieve this fiscal target, France plans to increase taxes on high-income households and large corporations, while also cutting expenditures in government departments.

According to a survey conducted by the French polling firm Elabe, the majority of French citizens view the 2025 budget draft, which was passed on February 6, as“poor.” However, they also acknowledge that it is better than having no budget at all.

Germany's industrial output in December fell to a more than four-year low

Data released by the Federal Statistical Office of Germany on February 7 revealed that industrial production in Germany fell by 2.4% MoM in December 2024, reaching its lowest level since May 2020, after adjustments for seasonal and working-day factors. This decline was primarily driven by a significant drop in automotive industry output.

The data showed that in December, Germany's energy sector output increased by 1.1% MoM, while construction output remained unchanged from the previous month. Excluding the energy and construction sectors, industrial production in Germany fell by 3.3% MoM, with automotive output plunging by 10% MoM.

On an annual basis, adjusted for working days, Germany's industrial output declined by 4.5% in 2024 compared to the previous year. The Federal Statistical Office noted that this decline was mainly due to substantial decreases in automotive and machinery manufacturing output, which fell by 7.2% and 8.1%, respectively.

The Federal Ministry for Economic Affairs and Climate Action stated that as of the end of 2024, there were no signs of recovery in Germany's industrial economy. Although industrial new orders increased significantly in recent months, this growth was largely due to the volatility of large-scale orders on a monthly basis. Meanwhile, several latest economic sentiment indicators showed that business confidence remained at a low level.

Non-farm payrolls: A green light for the Federal Reserve to maintain its current stance?

The US Bureau of Labor Statistics released its monthly jobs report on Friday, showing that non-farm payrolls increased by 143,000 jobs in January, while December's figure was revised upward to 307,000. The unemployment rate stood at 4.0%, while average hourly earnings rose by 0.5% MoM and 4.1% YoY.

Job gains in January were primarily driven by the healthcare, retail trade, and government sectors. In contrast, employment in mining and logging, oil and gas extraction, temporary help services, and motor vehicle manufacturing declined.

The latest employment data, when compared with figures from early 2023, indicate a slowing but healthy labor market that continues to support economic growth without exerting significant inflationary pressure. This also helps explain why Fed policymakers, after three rate cuts last year, have indicated a reluctance to further reduce borrowing costs.

Currently, Fed officials are grappling with waning inflationary pressures and uncertainties surrounding the Trump administration's new policies. Although Fed Chairman Jerome Powell recently described the labor market as“quite stable,” he and his colleagues have repeatedly emphasized their desire to avoid further cooling of the job market. Moreover, the Fed is likely to approach the latest employment data with caution to avoid over-interpreting the figures.

Tim Laursen: The January employment report is unlikely to change the Fed's wait-and-see attitude

Nick Timiraos, the Wall Street Journal reporter known as the “Fedwire” correspondent, noted in a recent article following the latest non-farm payrolls report that the US labor market has stabilized after slowing in the summer of 2024. The strengthening wage data at the end of 2024, combined with a decline in hiring in January, suggests that the labor market has reached a more stable state.

The Fed's primary focus is currently on identifying evidence that inflation is sustainably declining to its target level. Officials believe that the labor market is unlikely to become a source of new inflationary pressures in the near term. The Fed has signaled a preference for a passive and reactive policy stance, waiting for more data to inform its next steps. In particular, the Fed will closely monitor inflation performance in the first quarter of this year, as inflation levels during this period have historically been higher.

A more pronounced slowdown in the labor market could reignite discussions within the Fed about rate cuts, as it might indicate that the current policy stance is restraining economic growth.

Philip Lane: Caution advised on focusing too much on the neutral interest rate

European Central Bank (ECB) Chief Economist Philip Lane emphasized in a speech on Friday that the ECB will carefully examine economic data when determining the extent of interest rate cuts, rather than focusing excessively on the so-called neutral rate, which is often touted as a guiding benchmark. Lane argued that as interest rates approach levels where they no longer exert downward pressure on economic growth, debates over this theoretical threshold become somewhat less relevant.

Lane highlighted the importance of narrative frameworks in shaping policy communication. One such framework is the understanding that when inflation is significantly above the 2% target, it is crucial for everyone to recognize that monetary policy will be restrictive. However, as euro area inflation approaches its target, the focus should shift to how much further interest rates need to be reduced.

[Today's Focus]

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Alex

Commodity

Gold prices reached all-time highs at the end of last month and have continued to climb steadily into the first week of February. This marks the sixth consecutive bullish weekly candle, with a 2.5% gain over the past seven days. This performance is noteworthy, especially given the fluctuations in most other markets.

From a technical perspective, gold is starting a Fibonacci extension pattern. The global rally commenced in October 2023 following initial signals from the Federal Reserve indicating an easing of monetary policy and a subsequent slowdown in the pace of rate hikes. Between October and November 2024, after appreciating by 55% to reach the $2790 level, gold experienced significant profit-taking, resulting in a pullback to $2550, which represents 76.4% of the initial rally. This was followed by several weeks of intense trading between bullish and bearish market participants.

By the end of December, steady buying momentum had returned to the gold market. A move above $2800 in late January has led to discussions about the potential onset of a new global growth wave. If this trend continues, the price of gold may potentially reach the $3400 per troy ounce area between August and October of this year.

In contrast, silver remains more subdued, currently sitting 7% below its highs from October last year. However, it has shown strong performance over the past week. Should gold continue its upward trajectory, silver is expected to rise at a faster pace, thereby recovering lost ground.

Source: ACTIONFOREX

Risk Warnings and Disclaimers

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Cohen

Economic

Bold vision or misplaced ambition?

On 3 February, President Donald Trump signed an executive order directing Treasury Secretary Scott Bessent and Commerce Secretary-designate Howard Lutnick to develop a plan for a US sovereign wealth fund within 90 days. The idea is ambitious, but is it a good one? Would it even qualify as a SWF?

Globally, well-regarded SWFs have clear mandates and specific funding mechanisms. The US proposal, as presented, lacks these elements, making it an unusual potential entrant in the SWF landscape.

Understanding this distinction is critical in evaluating its feasibility and implications.

What defines a sovereign wealth fund?

Governments have traditionally established SWFs to manage surplus wealth accumulated from excess revenues. For instance, the Norwegian and the Gulf States funds are financed by oil and gas exports, ensuring that a consistent stream of surplus revenues backs their funds. Singapore’s Government Investment Corporation has prudently managed the country’s foreign reserves, making strategic, long-term investments that have contributed to Singapore’s position as a global financial hub. Meanwhile, the China Investment Corporation was seeded with surplus foreign exchange reserves. Asset allocation activities undertaken by these SWFs keep economic policy goals of wealth preservation, stabilisation and funding future liabilities in view.

The US, however, lacks these traditional funding sources. Unlike commodity-exporting nations, it does not directly control energy production revenues. Its fiscal position is also starkly different, with a budget deficit of 7% of gross domestic product and public debt standing at approximately 100% of GDP. The US has limited foreign exchange reserves. Without the foundational financial pillars that have supported other traditional SWFs, the US proposal does not appear to fit the standard model.

Instead, it purportedly attempts to create a US investment vehicle reliant on asset monetisation and/or debt issuance and undertaking strategic state-directed or policy-driven acquisitions. This diverges from the principles that underpin the world’s leading SWFs, as defined by the International Monetary Fund and expanded upon by the International Forum for Sovereign Wealth Funds.

How it gets funded will be a key consideration

Several proposals have emerged regarding how the US could finance its version of a SWF. Some suggest the government could monetise its balance sheet by liquidating federal assets. The US holds federal lands and over 260m ounces of gold, valued at approximately $750bn, which could theoretically be sold to generate funding. Another potential source includes the 200,000 seized bitcoins currently held by the government.

A more contentious proposal involves issuing debt to fund investments, effectively turning the fund into a hedge-fund-like structure. However, this raises serious concerns about risk management, as traditional SWFs are designed to operate on accumulated national wealth rather than leveraging debt to enter speculative financial markets. The idea of a US SWF financed through borrowing contradicts the essence of ‘sovereign wealth,’ making it more akin to a sovereign investment fund with short-term fiscal considerations rather than a long-term wealth-preserving vehicle.

Governance will be another pressing concern

Beyond financing, the governance of such an entity poses critical questions that have yet to receive adequate attention. Would Congress need to authorise the fund, like the Strategic Petroleum Reserve? If so, what legal framework would ensure its operational independence and protect it from political influence?

Additionally, what specific objectives would this fund serve? Would it be designed to counter China’s dominance in critical minerals or fund emerging technologies? The answers to these questions are crucial in determining whether the proposal serves a legitimate economic function or merely represents a politically motivated initiative.

Another primary concern is transparency and oversight. Leading SWFs operate with independent investment mandates in global good practices, avoiding politically driven and short-term policy driven decisions. If short-term political interests influenced the US fund, it could undermine investor confidence and weaken the US fund’s long-term sustainability. The lack of a clear governance structure would create uncertainty about how the fund would be managed, raising concerns about accountability and potential misuse, such as cronyism or an ad hoc slush fund used for fiscal management.

Lessons from good global practices

The IFSWF, which is globally responsible for maintaining and adhering to the established Santiago Principles – a set of 24 voluntary guidelines for effective management designed by traditional SWFs – has frequently stressed the necessity of a clear legal framework, well-defined objectives, robust governance structures and transparent investment strategies. Countries with leading SWFs have successfully institutionalised these good practices, ensuring their funds remain insulated from political influence at regular times and effectively serve their intended macroeconomic and investment purposes.

It is unclear at this stage the extent to which the US proposal will also adhere to these good practices. Without a clear legal mandate and a well-defined governance framework, a US SWF risks becoming a politically driven investment vehicle rather than a fiscally and economically grounded institution with a defined role in the US economy. Moreover, its reliance on debt or asset liquidation to finance investments deviates from the traditional model, further complicating its legitimacy in global capital markets.

By contrast, the UK is creating a National Wealth Fund rather than a traditional SWF to support longer-term domestic investment. Both the UK’s NWF and the US proposal resemble sovereign investment funds rather than intergenerational savings vehicles. This distinction is vital because a sovereign investment fund is typically geared towards specific economic or strategic goals, whereas a traditional SWF exists to preserve national wealth over generations. If the US fund follows the UK model, it should be labelled as such to avoid confusion and misaligned expectations.

The road ahead: clarifying the US proposal.

The idea of a US SWF is appealing and headline-grabbing. But Bessent and Lutnick must clarify key aspects of this initiative. What problem is the fund trying to solve? If the problem is so significant, why shouldn’t it be directly tackled through the budget and existing apparatus?

A fund’s intended mandate must be clearly defined – whether the goal is to invest in economic growth, national security speculative investments or statecraft. Establishing a robust governance framework with precise oversight will ensure transparency and fiscal accountability. Until these aspects are transparently addressed, the US initiative may take on the appearance of industrial policy or governmental picking of winners and losers.

The US must ensure that any proposed investment fund aligns with international best practices. Bessent and Lutnick would be well advised to study the Santiago Principles and some of the well-established traditional funds – including the Alaskan Permanent Fund – and emulate to the maximum extent possible their high-quality practices.

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

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Cohen

Economic

Dollar edged higher in early US session following the non-farm payrolls (NFP) report, but the overall momentum remains lackluster. Stock futures are flat, while 10-year Treasury yield is staging a slight recovery, suggesting a measured market response as traders hold back from aggressive positioning ahead of next week’s key economic events including US CPI and Fed Chair Jerome Powell’s testimony.

While headline NFP figure of 143k fell short of expectations, the dip in the unemployment rate to 4.0% and strong wage growth at 0.5% mom have reinforced the Fed’s cautious stance towards further policy easing. Markets now see over 90% chance that Fed will keep rates unchanged in March, while expectations for another hold in May stands at 70%.

Overall, despite today’s recovery, Dollar is still trading as the worst performer for the week, followed by Euro, and then Swiss Franc. Yen continues to sit at the top of the ladder, followed by Canadian, and then Aussie. Kiwi and Sterling are mixed in the middle.

In Europe, at the time of writing, FTSE is down -0.18%. DAX is down -0.06%. CAC is down -0.02%. UK 10-year yield is down -0.0014 at 4.489. Germany 10-year yield s up 0.0149 at 2.395. Earlier in Asia, Nikkei fell -0.72%. Hong Kong HSI rose 1.16%. China Shanghai SSE rose 1.01%. Singapore Strait Times rose 0.81%. Japan 10-year JGB yield rose 0.0357 to 1.303.

US NFP grows 143k, wages growth strong

US non-farm payroll job growth fell short of expectations but wage growth exceeding forecasts. Employers added 143k jobs, missing the 169k estimate and coming in below the 2024 monthly average of 166k. However, the downward surprise was offset by a significant upward revision to December’s number, which was adjusted from 256k to 307k.

Unemployment rate unexpectedly dropped from 4.1% to 4.0%. At the same time, the labor force participation rate ticked slightly higher to 62.6%, reinforcing signs of a still-active workforce. While the decline in headline job creation might signal a cooling labor market, the improvement in unemployment suggests that the slowdown is not yet severe.

The standout data point in the report was wage growth, with average hourly earnings surging 0.5% mom, surpassing the expected 0.3% mom increase. On an annual basis, wages rose 4.1% yoy, a sign that businesses are still competing for workers despite moderation in hiring.

Canada’s employment grows 76k, unemployment rate down to 6.6%

Canada’s labor market significantly outperformed expectations in January, with employment rising by 76.0k, far exceeding 26.5k forecast. The biggest job gains were seen in manufacturing (+33k, +1.8%) and professional, scientific, and technical services (+22k, +1.1%).

The unexpected strength in employment was further reinforced by decline in the unemployment rate from 6.7% to 6.6%, beating market expectations of a slight uptick to 6.8%.

Despite the surge in hiring, wage growth showed signs of moderation, with average hourly earnings rising 3.5% yoy, down from 4.0% yoy in December. Total actual hours worked rose 0.9% mom, with a 2.2% annual increase.

IMF backs BoJ’s gradual rate hikes, sees policy rate moving toward neutral by 2027

Nada Choueiri, deputy director of IMF’s Asia-Pacific Department and mission chief for Japan, stated that IMF remains “supportive” of BoJ’s current monetary policy course. She emphasized that rate hikes should be implemented in a gradual and flexible manner to ensure that domestic demand continues to recover.

Choueiri projected that BoJ’s policy rate could rise “beyond 0.5%” by the end of this year, with a longer-term path toward the “neutral level” by the end of 2027.

IMF estimates Japan’s neutral rate to be within a band of 1% to 2%, with a midpoint of 1.5%.

Also, IMF maintains an optimistic outlook for Japan’s economy, forecasting 1.1% GDP growth in 2025, supported by increasing wages and stronger consumer spending.

Given these projections, IMF expects BoJ to continue its tightening cycle in a controlled manner.

EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.0355; (P) 1.0381; (R1) 1.0410;

EUR/USD dips mildly but stays well inside range of 1.0176/0531. Intraday bias remains neutral and more consolidations could be seen. Strong resistance is expected from 1.0531 to limit upside. On the downside, break of 1.0176 will resume whole fall from 1.1213. However, sustained break of 1.0531 will rise the chance of bullish reversal and turn bias back to the upside for stronger rally.

Dollar Gains Modestly on NFP, but Lacks Momentum_1

In the bigger picture, immediate focus is back on 61.8 retracement of 0.9534 (2022 low) to 1.1274 (2024 high) at 1.0199. Sustained break there will solidify the case of medium term bearish trend reversal, and pave the way back to 0.9534. However, strong support from 1.0199 will argue that price actions from 1.1274 are merely a corrective pattern, and has already completed.

Dollar Gains Modestly on NFP, but Lacks Momentum_2

Source：Actionforex

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

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ACY

Commodity

Gold has kicked off 2025 with an explosive start, consistently reaching new record highs as investors seek safety amidst a volatile economic and geopolitical landscape. With escalating trade tensions, shifting central bank strategies, and uncertainty surrounding U.S. monetary policy, gold’s appeal as a safe haven asset remains stronger than ever.

XAUUSD 15minutes Chart

Gold's Rally Accelerates Amidst Economic and Geopolitical Uncertainty_1

Trade Tensions and Geopolitical Uncertainty Bolster Gold Demand

Trade disputes continue to weigh on global markets. The U.S. has pushed forward with 10% tariffs on Chinese imports, prompting immediate retaliation from Beijing. While tariffs on Canada and Mexico have been postponed, the uncertainty surrounding these policies is fuelling demand for gold. If trade negotiations deteriorate further, gold’s role as a hedge against economic instability will only be reinforced.

Beyond trade, political unpredictability is another key driver. President Donald Trump’s recent statements on U.S. involvement in Gaza reconstruction have added a new layer of uncertainty, amplifying demand for gold. With a highly volatile geopolitical environment, investors are turning to assets that offer protection against systemic risks, and gold remains at the top of that list.

Central Banks Continue Their Gold Accumulation

A significant pillar of gold’s rally has been continued central bank purchases. In 2024, central banks acquired over 1,000 tonnes of gold for the third consecutive year, with China leading the charge. The National Bank of Poland also made aggressive moves, increasing its reserves by 90 tonnes.

This accumulation is largely driven by concerns over economic sanctions. The freezing of Russian assets by Western nations has prompted other countries to reconsider their reserve allocations, leading to increased diversification into gold. This trend is expected to persist in 2025, providing steady support for prices as central banks hedge against potential financial restrictions.

Soaring U.S. Gold Stockpiles Signal Strong Investor Appetite

Following Trump’s re-election, gold stockpiles in the U.S. have surged. Comex inventories are at their highest levels since 2022, as tariff concerns and arbitrage opportunities have fuelled inflows. Imports from Switzerland, a key refining hub, have risen sharply, mirroring levels seen after Russia’s 2022 invasion of Ukraine.

While gold itself has not been directly targeted by U.S. tariffs, speculation remains that it could be included in broader trade restrictions. Should that occur, gold prices in the U.S. would likely experience heightened volatility and a restructuring of trade flows. With Mexico and Canada collectively accounting for nearly half of U.S. gold imports, any disruption to these supply chains would have significant market implications.

ETF Inflows Provide Additional Momentum

Exchange-traded funds (ETFs) tracking gold have also seen renewed interest. Despite a relatively flat performance in late 2024, ETF holdings have started to climb in recent weeks. If this trend continues, driven by geopolitical risks and expectations of U.S. rate cuts, it could provide another tailwind for gold prices.

Monetary Policy: The Federal Reserve’s Role in Gold’s Trajectory

Perhaps the most critical factor influencing gold’s outlook is the Federal Reserve’s interest rate policy. Following 100 basis points of rate cuts in late 2024, the Fed has opted to hold rates steady in early 2025. While rate cuts are still expected later in the year, a slower-than-anticipated pace of easing could temper some of gold’s momentum.

Nonetheless, declining interest rates remain a bullish factor for gold. With expectations of two rate cuts in the second half of 2025 and another possible cut in early 2026, lower borrowing costs will enhance gold’s attractiveness as a non-yielding asset. The market consensus suggests that as monetary policy loosens, gold will continue to find support from investors seeking stability.

Gold’s Price Outlook: $3,000/oz Within Reach?

Given the current macroeconomic backdrop, gold appears poised to break further records. The combination of falling interest rates, sustained central bank purchases, and geopolitical tensions provides a strong foundation for further gains. Current projections indicate an average price of $2,800/oz in the first quarter of 2025, with gold likely testing the $3,000/oz threshold before mid-year.

While a strong U.S. dollar and potential monetary tightening could introduce headwinds, increasing trade frictions and continued demand from institutional investors may offset these pressures. If uncertainty remains high, gold will maintain its status as the go-to asset for stability.

The year has just started, but gold is already proving its resilience in an era of uncertainty. Whether driven by trade wars, shifting central bank policies, or monetary easing, the precious metal remains a core asset for investors navigating volatile markets. With the right conditions in place, 2025 could very well be another historic year for gold.

Risk Warnings and Disclaimers

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Warren Takunda

Cryptocurrency

Federal Reserve Bank Governor Christopher Waller says he supports the adoption of stablecoins with clear rules and regulations because it will likely cement the US dollar’s status as a reserve currency.

Waller, chair of the Fed Board’s payments subcommittee, said in a Feb. 6 interview with think tank the Atlantic Council that stablecoins “will broaden the reach of the dollar across the globe and make it even more of a reserve currency than it is now.”

“What I see with stablecoins is they are going to open up possibilities and other ways of doing payments on the rails,” he said.

In Waller’s opinion, good regulation of stablecoins only strengthens the dollar as a reserve currency and its use in international trade, finance and investments.

An October report from venture capital firm Andreessen Horowitz found US dollars make up more than 99% of stablecoin currency shares, with the largest stablecoin by value, Tether, accounting for nearly 80% of stablecoin trading volume on average.

“I view stablecoins as a net addition to our payment system,” Waller said.

“You might want regulatory rails around it to make sure the money is there, who is authorizing, who is checking to make sure it’s fully backed,” he added.

There have been growing concerns that the US dollar could lose dominance as the world’s reserve currency and be the go-to currency for international transactions and commodity trades.

The intergovernmental organization BRICS, a coalition of countries including Brazil, Russia, India, China and South Africa, is pushing for international trade to move away from using the US dollar.

Waller says with the use of stablecoins, efforts by other countries to stifle the US dollar will be a lot more complicated.

“Right now, with dollarization in most countries, there are a lot of rules that have tried to stop it or prevent it,” Waller said.

“It’s a lot harder to stop stablecoins than confiscating currency that people might be hoarding in their bedroom; it’s a little harder to take it off the blockchain.”

An October Chainalysis report revealed that the US is lagging in stablecoin adoption, with the market share of stablecoin transactions on US-regulated exchanges dropping below 40% in 2024, while transactions on offshore exchanges rose to 60%.

It comes as US Senator Bill Hagerty introduced the GENIUS stablecoin bill to create a regulatory framework for high market cap US-pegged crypto tokens on Feb. 4.

The legislation proposes that stablecoins be defined as digital assets pegged to the US dollar. Federal Reserve regulations will govern issuers with tokens above $10 billion in market cap, while the states will regulate issuers below that threshold.

On the same day, US President Donald Trump’s crypto czar, David Sacks, confirmed plans to bring stablecoin innovation onshore, flagging it as a key area of focus, along with Bitcoin adoption and blockchain development.

Stablecoin market capitalization has grown since mid-2023, surpassing $200 billion in January.

They also saw massive adoption in 2024, driven by the increased use of bots, with total stablecoin trans volumes reaching $27.6 trillion, surpassing the combined volumes of Visa and Mastercard by 7.7%.

Source: Cointelegraph

Risk Warnings and Disclaimers

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Cohen

Commodity

Gold drops amid rising US Treasury yields and a stronger US Dollar.

US equity downturn and job market worries heighten market jitters ahead of Nonfarm Payrolls.

Fed's Goolsbee suggests cautious monetary policy, impacting gold amidst global trade tensions.

Gold price advance stalled on Thursday as United States (US) Treasury bond yields recovered, and the Greenback holds minimal gains. Traders seem to be booking profits ahead of the release of the latest US Nonfarm Payrolls report, which could spark volatility in the financial markets. XAU/USD traded at $2,852, down 0.38%.

With no clear catalyst, the market mood shifted negatively as US equity indices turned lower. Despite this, the non-yielding metal continued to trim some of its weekly gains amid increased tensions due to the trade war between China and the US.

In addition, US jobs data showed that the number of people applying for unemployment benefits rose in the week ending February 1, revealed the US Department of Labor. A Bloomberg report said the report was mainly ignored due to distortions spurred by wildfires in Los Angeles and worse weather conditions in other parts of the US.

Bullion failed to gain traction amid dovish comments by Chicago Fed President Austan Goolsbee. He said the Fed is in good shape for eventual cuts, though he added that uncertainty around Washington policies warrants a “slower approach.”

Daily digest market movers: Gold price weighed by US yields recovery

The US Dollar Index (DXY), which tracks the buck’s performance versus a basket of six currencies, holds minimal gains of 0.06% and is at 107.68.The US 10-year Treasury bond yield climbs one and a half basis points, up at 4.44%.US real yields, which correlate inversely to Bullion prices, climb one and a half basis points from 2.01% to 2.0026%, a tailwind for XAU/USD.For the week ending February 1, US Initial Jobless Claims increased to 219K, up from 208K the previous week and surpassing forecasts of 213K. This rise indicates more Americans filed for unemployment benefits than expected.US Nonfarm Payrolls in January are expected to dip from 256K to 170K. The Unemployment Rate is projected to remain unchanged at 4.1%.Money market fed funds rate futures are pricing in 47.5 basis points (bps) of easing by the Federal Reserve in 2025.

XAU/USD technical outlook: Gold price falls below $2,860

Despite dipping, the XAU/USD pair is poised to extend its rally and challenge the year-to-date (YTD) high of $2,882 ahead of $2,890. Once those two levels are cleared, the next resistance would be $2,900.

The Relative Strength Index (RSI) remains at overbought territory. Still, as previously mentioned, “it hasn’t reached the most extreme level above 80, which could pave the way for a mean-reversion trade.”

Therefore, XAU/USD fell to a daily low of $2,834, but buyers lifted Gold prices above $2,850, opening the door for further upside.

Conversely, if Bullion plunges below $2,800, immediate support would be the January 27 swing low of $2,730, followed by $2,700.

Gold Price Drops as Traders Await Nonfarm Payrolls_1

Source：FXStreet

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February 8th Financial News

[Quick Facts]

[News Details]

[Today's Focus]

Gold’s Rise: A New Bull Market Dawns

Source: ACTIONFOREX

US Sovereign Wealth Fund Debate: a Solution in Search of a Problem?

Bold vision or misplaced ambition?

What defines a sovereign wealth fund?

How it gets funded will be a key consideration

Governance will be another pressing concern

Lessons from good global practices

The road ahead: clarifying the US proposal.

Dollar Gains Modestly on NFP, but Lacks Momentum

US NFP grows 143k, wages growth strong

Canada’s employment grows 76k, unemployment rate down to 6.6%

IMF backs BoJ’s gradual rate hikes, sees policy rate moving toward neutral by 2027

EUR/USD Mid-Day Outlook

Source：Actionforex

Gold's Rally Accelerates Amidst Economic and Geopolitical Uncertainty

XAUUSD 15minutes Chart

Trade Tensions and Geopolitical Uncertainty Bolster Gold Demand

Central Banks Continue Their Gold Accumulation

Soaring U.S. Gold Stockpiles Signal Strong Investor Appetite

ETF Inflows Provide Additional Momentum

Monetary Policy: The Federal Reserve’s Role in Gold’s Trajectory

Gold’s Price Outlook: $3,000/oz Within Reach?

Fed’s Waller Backs Regulated Stablecoins to Boost US Dollar’s Global Dominance

Source: Cointelegraph

Gold Price Drops as Traders Await Nonfarm Payrolls

Daily digest market movers: Gold price weighed by US yields recovery

XAU/USD technical outlook: Gold price falls below $2,860

Source：FXStreet

Risk Disclosure