Fundamentals: Yesterday, the market was waiting for the US CPI and PPI inflation data in April. Goldman Sachs and Barclays warned customers not to bet on interest rate cuts this year. US Treasury Secretary Yellen repeatedly warned that the debt ceiling may cause "economic disaster". The survey found that bank credit tightened in the first quarter. Of the three major U.S. stock indexes, only the Dow closed down, while the S&P and the Nasdaq turned lower several times during the session. The two-year U.S. bond yield rose to 4.0% intraday, rising nearly 10 basis points at one point. The U.S. dollar index turned higher after approaching a two-year low, and gold rebounded slightly.
The Federal Reserve released its first semi-annual financial stability report this year, and it is also the first overall financial system assessment report since the banking crisis broke out in March. In the report, the Federal Reserve commented that the banking industry generally maintains resilience, with relatively stable financing and ample liquidity, but listed the pressure on the banking system as one of the near-term risks of the financial system, saying that a sharp contraction in bank credit supply will push up financing for businesses and households costs, which could lead to a slowdown in economic activity. Other near-term risks include rising interest rates in advanced economies such as the United States and heightened geopolitical tensions.
According to the survey, in the first quarter, the proportion of American banks that tightened commercial and industrial loan conditions for large and medium-sized enterprises rose to 46% from 44.8% in the fourth quarter of last year; the proportion of banks reporting weak demand for commercial and industrial loans of large and medium-sized enterprises rose to 55.6%. the highest level since the financial crisis. The Fed expects the problem to persist through at least next year.
Respondents to the New York Fed survey expect U.S. household spending to fall sharply next year. This reflects subdued consumer sentiment and a likely slowdown in inflation. At the same time, the respondents’ expectation of house price growth in the next year rose to 2.5%, a record high since July last year, an increase of 0.7 percentage points from March; only 35.8% of people expected the U.S. stock market to rise, hovering in the past ten years the lowest level.
Central banks around the world are buying gold in large quantities in early 2023. Demand in the first quarter reached 228 tons, an increase of 176% from 82.7 tons in the same period last year, the strongest first quarter on record. The Monetary Authority of Singapore was the largest single buyer in the first quarter, buying 69 tonnes of gold for the first time since June 2021. This was followed by a 58-ton increase in China's central bank gold reserves.