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Gold Stocks Fall as Another Fed Official Hawks
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Gold stocks in Hong Kong fell sharply on Tuesday, with Zijin Gold International dropping 4.26% and Lingbao Gold falling 4.22%, amid renewed hawkish signals from a U.S. Federal Reserve official. St. Louis Fed President Alberto Musalem stated on Monday that due to strong demand and commodity price shocks spreading beyond oil, the Fed may need to raise interest rates further to curb inflation, adding that the central bank should act quickly. The decline follows a period of reduced market focus on Fed independence and lower oil prices, which had weakened energy inflation trades. According to CITIC Futures, gold's sensitivity to U.S. real yields, the dollar, and Fed commentary may now increase, as the market lacks a new single macro narrative after the September rate hike.
Source report
Gold stocks came under renewed pressure on Monday, with several major players posting losses.
Key price movements (as of press time):
- Zijin Gold International (02259): Down 4.26%, trading at HKD 148.20
- Lingbao Gold (03330): Down 4.22%, trading at HKD 22.24
- Shandong Gold (01787): Down 1.96%, trading at HKD 21.96
Market Drivers
The sell-off followed hawkish comments from a Federal Reserve official. St. Louis Fed President Alberto Musalem stated on Monday that the Fed may need to raise interest rates further to curb inflation, citing strong demand and commodity price shocks that have spread beyond oil. He emphasized that the Fed should act sooner rather than later.
Analyst Perspective
According to CITIC Futures, following the September rate hike, the gold market currently lacks a single dominant macro narrative in the short term. The firm noted:
- Market attention on Fed independence has temporarily declined
- Falling oil prices have weakened energy-inflation trading
- Gold's sensitivity to real yields, the U.S. dollar, and Fed officials' commentary may increase again
Source
智通财经Eastern
Part of this Story
Hong Kong gold stocks plunge as Fed officials signal further rate hikes