Gold Edges Lower As Dollar Rebounds Ahead Of Central Bank Meetings

Gold prices ticked lower on Thursday after climbing more than 1 percent in the previous session, helped by a pullback in the greenback and bond yields.

Spot gold eased 0.2 percent to $1,782.16 per ounce, while U.S. gold futures were down 0.2 percent at $1,793.85.

The dollar recovered slightly today, as investors keenly awaited U.S. inflation data as well as the outcome of the Fed, ECB and Bank of England policy meetings next week for further clues on the direction of monetary policy.

The Bank of Canada on Wednesday hiked its key overnight rate by half a percentage point to the highest level in almost 15 years and signaled it was nearing the end of its unprecedented tightening cycle.

A report on weekly jobless claims may attract some attention later today, although trading may be somewhat subdued ahead of Friday’s reports on producer price inflation and consumer sentiment.

The University of Michigan’s preliminary report on consumer sentiment includes readings on inflation expectations that could impact the outlook for interest rates.

Democrats Ensure Clear Senate Majority With Georgia Runoff Win

The Democrats have ensured a clear majority in the Senate by winning the Georgia Senate runoff.

Senator Raphael Warnock’s victory over his Trump-backed challenger Herschel Walker gave the Democrats a crucial 51 seats in the 100-member Upper House.

None of the candidates secured 50 percent of the votes in the midterm elections held in November.

With 99 percent of votes counted in the tight runoff, 51.4 percent went to Warnock and 48.6 percent to Walker.

Delivering a victory speech in Atlanta, Warnock said, “It is my honor to utter the four most powerful words ever spoken in a democracy: the people have spoken!”

The 53-year-old Baptist pastor became the first black senator in Georgia when he was first elected in January 2021.

The outright majority in the Senate gives the Democrats the advantage of passing bills and advancing President Joe Biden’s nominees more easily and ensures a majority on committees.

If all Democrat senators vote along party lines in the Senate, Vice President Kamala Harris will have no need to cast the tie-breaking vote as has been the case over the last two years in an evenly divided chamber.

Google To Combine Maps And Waze Teams

Google, owned by Alphabet Inc., plans to merge its teams working on Maps products and the mapping service Waze with effect from December 9, reports said.

The decision to consolidate processes comes as the search giant is facing pressure to streamline operations and cut costs. The restructuring is expected to reduce overlapping work across the Waze and Maps products.

Beginning on Friday, Waze’s more than 500 employees will be merged with Google’s Geo organization, which oversees Google Maps, Google Earth, and Street View products.

Following a transition period, Waze CEO Neha Parikh will exit her role. Google said it plans to maintain Waze as a stand-alone service and there are no plans to conduct any layoffs as part of the reorganization.

A spokeswoman reportedly said, “By bringing the Waze team into Geo’s portfolio of real-world mapping products, the teams will benefit from further increased technical collaboration.”

Alphabet CEO Sundar Pichai earlier had said that the company would streamline processes and consolidate investments where they overlap.

Waze, formerly FreeMap Israel, provides satellite navigation software on smartphones and other computers that support the Global Positioning System. It has about 151 million monthly active users worldwide.

Waze is a more driver-focused app, while Google Maps is much more comprehensive and provides navigation for anyone.

Waze’s former CEO Noam Bardin reportedly said earlier that the company struggled to grow within Google and that it could have grown faster and more efficiently if it was independent.

Oil Rebounds As China Eases Strict COVID Curbs

Oil rebounded from 2022 lows on Thursday, as China began implementing a more relaxed version of its strict “zero COVID” policy and reports emerged that some tankers carrying Russian oil are facing delays in crossing to the Mediterranean from Russia’s Black Sea ports after a G7 price cap came into effect.

Benchmark Brent crude futures rose 0.7 percent to $77.71 a barrel, while WTI crude futures were up 1.1 percent at $72.81.

Both contracts hit 2022 lows on Wednesday, giving up all of the gains since Russia’s invasion of Ukraine, after data from Energy Information Administration (EIA) showed a sharp increase in gasoline inventories in the week ended December 2nd.

Recession worries also hurt markets after top U.S. banks warned of a recession in 2023 and China reported weak trade balance figures for November.

Three years into the pandemic and following widespread protests last month, many Chinese embraced newfound freedoms today after the country dropped key parts of its tough zero-COVID regime.

Bank Of Canada Raises Interest Rates By Another 50 Basis Points

The Bank of Canada on Wednesday announced its widely expected decision to raise interest rates by another half a percentage point, saying inflation remains “too high.”

The Canadian central bank increased its target for the overnight rate by 50 basis points to 4.25 percent, marking the seventh consecutive rate hike.

However, comments in the accompanying statement seemed to suggest the Bank of Canada is nearing the end of its tightening cycle.

“Looking ahead, Governing Council will be considering whether the policy interest rate needs to rise further to bring supply and demand back into balance and return inflation to target,” the Bank of Canada.

The Bank of Canada’s decision to continue raising interest rates comes as inflation remains well above the bank’s 2 percent target, although it noted the three-month rates of change in core inflation have come down.

“Inflation is still too high and short-term inflation expectations remain elevated,” the bank said. “The longer that consumers and businesses expect inflation to be above the target, the greater the risk that elevated inflation becomes entrenched.”

The Bank of Canada said it is also continuing its policy of quantitative tightening, which it said is complementing increases in the policy rate.

“We are resolute in our commitment to achieving the 2% inflation target and restoring price stability for Canadians,” the bank concluded.