In the CNBC interview, the US President Donald Trump said that he was not "impressed" with the actions of the Federal Reserve System and the raise of interest rates.
The head of the United States of America, Donald Trump:
"As a matter of fact, I'm not very happy, but at the same time, I'm letting them (the Fed) do what they feel is the best."
Such statements of Trump did not go unnoticed in the market. The topic of the day: will the US president exert pressure on the Federal Reserve System?
It is unlikely that Trump will affect the Federal Reserve so that the graph for the interest rates hike could change, but there is a high probability that he will continue to express his opinion via Twitter. As you know, D. Trump's statements can immediately change the situation within the financial market.
On Tuesday, 24th of July, the head of the US noted with great optimism that GDP growth will amount to almost 5%.
While the team of economists is preparing to celebrate Trump's victory based on the impressive data that proves America's economic growth, things are getting much worse in the countries of the Western Hemisphere.
The International Monetary Fund has issued a warning that the depreciation of money in Venezuela poses a threat to the population.
The Head of the IMF's department for the Western Hemisphere Alejandro Werner noted that the inflation rate in one of the countries of South America is approaching a million percent. As we reported in the article "Why is gold worth buying?", Venezuela ranks first in the top of countries with the largest amount of depreciated money. Imagine that a cup of cappuccino in the capital of Caracas costs two million bolivars, which is a little less than a dollar.
In conditions of rising inflation and tough economic situation in the world, gold remains stable.
On Tuesday, an ounce of the precious metal was worth $1,224.
On Wednesday, 25th of July, more than 100 economists interviewed by Reuters confirmed the concern over the growing risks for the US macroeconomics. According to given forecasts, the Fed will continuously raise interest rates. In addition to that, an aggravation of relations between China and America is possible. All these factors will cause a weakening effect on the economy of the American state.
The decrease of the dollar's position led to an increase of the price of gold, which on Wednesday reached $1,231 per ounce.
On Thursday, 26th of July, the US currency was under pressure due to negotiations between the US and the EU. While in Washington, the President of the European Commission Jean-Claude Juncker and the US President Donald Trump announced joint actions to cancel industrial tariffs and initiated a launch of the new phase of trade relations during their negotiations. Owing to reports that the trade conflict is nearing resolution, the dollar temporarily lost its positions.
In the photo: Two leaders are striving to achieve the same goal: "zero tariffs." The day of Trump’s and Juncker’s meeting was named "a big day for free and fair trade."
However, after the ECB meeting, the euro rate fell by 0.5%. Even though existing interest rates within the market were assumed to maintain at the same level, the position of the European currency on the financial market has been shaken.
The price of gold amounted to $1,222 per ounce.
On Friday, 27th of July, the statement made by the head of the European Central Bank (ECB) Mario Draghi was further discussed. Thursday’s main event did not meet the expectations of investors: rates remained unchanged. The regulator reported on the growth of the economy in the EU countries and predicted an increase of core inflation.
In the photo: Mario Draghi has been named the most charismatic president of the ECB. Each statement made by the head of the European Central Bank has an impact on the financial market.
Draghi noted that all actions of the ECB will be cautious and taken in accordance with the "soft" monetary policy. In this regard, the increase of interest rates is expected to happen no earlier than next year’s summer.
On Friday, the price of an ounce of gold was $1,223.
On Monday, 30th of July, market participants were waiting for the outcome of the meetings between the central banks of Japan, England and the Fed. Following these meetings, currency rates will be set in the short-term.
On Monday morning, the price of the yellow metal was $1,220 per ounce.
Experts of the data analytics company GFMS consider that the current price of gold facilitates its sales growth both in China and India. For example, in the first half of 2018, the import of the precious metal to China amounted to 61,133 tons of gold. These figures are 75% higher than in the first half of last year.
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