Daily summary: Risk appetite returns after Jackson Hole kick-off

• USD tumbled after Powell’s speech

• Stock markets at new record highs

• Gold and silver gain on weaker USD

Friday was all about the long-awaited Jackson Hole and the Fed Chair’s speech - market were waiting for this event for weeks. Even before the Jackson Hole kicked-off, some Fed speakers delivered hawkish comments, which strengthened the USD and made the whole happening even more interesting. However, Powell’s remarks were rather dovish and eventually led to weaker USD. The Fed Chair did not provide concrete tapering date and ignored elevated inflation.

US stocks pushed higher after Powell’s speech, climbing to fresh all-time highs. European equity markets gained as well and finished the day higher. Apart from that, investors were focused on core PCE from the US for July - the Fed’s favourite inflation gauge. The reading was in-line with expectations (3.6% YoY) and had little impact on the market. 

The situation on commodity markets is interesting as well and indicates a risk-on mood. Oil prices advance roughly 2%, ahead of OPEC+ meeting next week. Copper gains 1.5%. Gold and silver jumped on the weaker USD. Interestingly, UoM’s 5-year inflation expectations in August fell slightly compared to flash data, from 3.0% to 2.9%.

Gold prices spiked after Powell’s remarks as the US dollar tumbled. In fact, gold bulls managed to break above recent local peak near $1,809 an ounce. It is worth to notice that gold prices have been sitting above the 100-period EMA (H4 interval). Should the upward move on the gold market continue, the attention might soon shift towards the resistance area near $1,832 an ounce. Source: xStation5