On Friday (November 29th) Beijing time, spot gold traded around 2638.60, with geopolitical uncertainty and trade concerns boosting safe haven demand supporting gold prices. US crude oil traded around $68.87 per barrel, with Israel and Lebanese armed group Hezbollah accusing each other of violating the ceasefire agreement, and Israeli tanks firing into southern Lebanon. Geopolitical tensions still support oil prices, as the US market is closed for the Thanksgiving holiday and trading is light.

Key focus for the day: German retail data, German unemployment data, France's Q3 GDP, Canada's GDP data, and Eurozone CPI data.

Reminder: Due to Thanksgiving, the New York Stock Exchange will be closed, and trading of precious metals and US crude oil futures contracts under the CME will end earlier at 02:45 Beijing time on the 30th. Trading of foreign exchange and stock index futures contracts will end earlier at 02:15 Beijing time on the 30th; The trading of Brent crude oil futures contracts under the Intercontinental Exchange (ICE) ended early at 03:00 Beijing time on the 30th.

gold market

Gold prices rose on Thursday as geopolitical uncertainty and trade concerns boosted safe haven demand, and trading is expected to remain quiet due to the US market being closed for the Thanksgiving holiday. Spot gold rose 0.2% to $2641.79 per ounce. US gold futures remained stable at $2642.00. Gold prices hit their biggest daily decline in over five months on Monday.

Aneeka Gupta, head of macroeconomic research at WisdomTree, stated that as the Russia Ukraine conflict continues, geopolitical risks remain high. Although the ceasefire agreement between Israel and Hezbollah has come into effect, Israel's retaliatory emergency measures still keep the situation tense.

She added that US President elect Trump's promise to impose tariffs on Canada and Mexico has also had an impact. This has indeed increased people's concerns about the possible reactions of these two countries. Therefore, it remains an important supporting factor for gold

However, Trump's tariff plan is also seen as a potential driver of inflation, which could prompt the Federal Reserve to slow down the pace of interest rate cuts, potentially limiting further gains in non yielding gold.

Wednesday's data shows that progress in reducing inflation in the United States over the past few months seems to have stalled, suggesting that the Federal Reserve will remain cautious when further cutting interest rates.

At present, the market believes that there is a 70% chance that the Federal Reserve will cut interest rates by 25 basis points in December. In a low interest rate environment, gold often performs well, with spot silver rising 0.5% to $30.22 per ounce; Platinum rose 0.9% to $935.25; Palladium rose 0.6% to $978.12.

Oil market

Oil prices rose on Thursday after Israel and the Lebanese armed group Hezbollah accused each other of violating a ceasefire agreement, while Israeli tanks fired at southern Lebanon. OPEC+has also postponed the meeting that may extend production cuts for a few days.

Brent crude oil futures rose 0.5% to $73.17 per barrel. US crude oil futures rose 0.2% to $68.88. Due to the Thanksgiving holiday in the United States, trading was sluggish.

The Israeli military claims that the ceasefire agreement has been violated, and some suspects (some of whom are in vehicles) have arrived at several locations in the southern region. The agreement, which came into force on Wednesday, aims to enable the two peoples to start returning to their homes in the border area, which has been torn apart by the 14 month war. The Middle East is one of the world's major oil producing regions, and although ongoing conflicts have not yet affected supply, they have been reflected in the risk premium of traders.

OPEC+sources told Reuters on Thursday that OPEC+is discussing postponing the oil production increase plan originally scheduled to start in January 2025 to the first quarter of 2025, and will have more discussions on this and other options before the policy meeting postponed to December 5th.

Commodity Context analyst Rory Johnston said, "The possibility of them announcing an increase in production at this meeting is very low," and oil prices have basically digested the factors of further postponement. DBS Bank's Suvro Sarkar said, "The only question is whether to postpone for one month, three months, or even longer

The US Energy Information Administration (EIA) announced on Wednesday that US gasoline inventories increased by 3.3 million barrels in the week ending November 22, slightly lowering oil prices, contrary to expectations of a slight decrease in fuel inventories before holiday travel. Since the beginning of this year, the slowdown in fuel demand growth in the two largest consuming countries has dragged down oil prices.

foreign exchange market

The US dollar index rebounded to 106.21 on Thursday, falling to a two-week low of 105.85 in the previous trading day. The euro fell against the US dollar on Thursday as traders reduced their bets on further interest rate cuts by the European Central Bank, while the overall foreign exchange market remained flat due to the US holiday performance.

The Japanese yen fell to the level of 151.58, but rose 2.1% this week, regaining lost ground since the US election and expected to achieve its best weekly performance in three months. The market believes that the possibility of the Bank of Japan raising interest rates next month is about 53%. Due to the US stock and bond markets being closed for the Thanksgiving holiday, trading was light.

Michael Brown, Senior Research Strategist at Pepperstone, said, "There may be a few sluggish days before the end of this week, but I expect the US dollar to rebound with the arrival of December." He added that the trend of the US dollar returning below 106 on Wednesday seems a bit "off fundamentals, we are still talking about American exceptionalism, a long list of incredible issues in the eurozone, and this morning there are budget concerns in France

The euro fell 0.2% to $1.054625. After ECB executive Schnabel made hawkish remarks, the euro rose sharply on Wednesday. This statement prompted investors to abandon more aggressive expectations of interest rate cuts and instead buy the euro, which is expected to record its worst monthly performance in two and a half years this month.

Germany's annual inflation rate remained unchanged in November, despite expectations of a second consecutive month of increase. Eurozone inflation data will be released on Friday, which may provide hints for the next steps of the European Central Bank.

At present, the money market believes that the possibility of the European Central Bank significantly cutting interest rates by 50 basis points is only 13%, while there was a 50% chance last Friday. The possibility of a 25 basis point interest rate cut has been fully digested. Carsten Brzeski, Global Macro Head of Dutch International Group, said, "The Eurozone macro data released today should encourage hawkish opposition from the European Central Bank to a 50 basis point rate cut in December." France's fragile coalition government is also being watched as it works to pass its budget.

The GBP/USD remained relatively stable at $1.2666, while the Swedish krona strengthened against the US dollar and the euro as data showed a rebound in sentiment among Swedish businesses and consumers in November.

AUD/USD rebounded from early weakness and rose slightly to $0.6501. Australian Federal Reserve Chairman Brock stated that the core inflation rate is too high and interest rate cuts are not allowed in the short term.

Although the major currency markets are somewhat sluggish, there are also some fluctuations in emerging markets. The Russian ruble strengthened to slightly above 110 rubles per US dollar, as the Russian central bank stated that it will stop purchasing foreign exchange before the end of the year to support the ruble. The ruble has depreciated by nearly one-third since August.

The Brazilian real has hit a record low due to concerns that tax cuts will affect tight budgets. The Korean won slightly weakened after the Bank of Korea cut interest rates for the second time in a row. Among the 38 economists surveyed by Reuters, only four foresaw this result.

international news 

The probability of the Federal Reserve cutting interest rates by 25 basis points in December is 66.3%

According to CME's "Federal Reserve Watch", the probability of the Fed keeping current interest rates unchanged until December is 33.7%, and the probability of a cumulative 25 basis point rate cut is 66.3%. The probability of maintaining the current interest rate unchanged until January next year is 25.8%, the probability of reducing interest rates by 25 basis points cumulatively is 58.6%, and the probability of reducing interest rates by 50 basis points cumulatively is 15.6%

Biden: Hope Trump reconsider plan to impose tariffs on Mexico and Canada

On November 28th local time, US President Biden expressed his hope that President elect Trump would reconsider plans to impose tariffs on Mexico and Canada, stating that this could "damage relationships with close allies". Biden stated that the United States, surrounded by Mexico, Canada, as well as the Pacific and Atlantic oceans, should not do anything more than damage its relations with Mexico and Canada.

IAEA: Iran plans to expand uranium enrichment activities at two factories

A report released by the International Atomic Energy Agency (IAEA) on Thursday stated that Iran has notified the agency of its plans to install more uranium enrichment centrifuges at its Fordow and Natanz nuclear plants and connect the recently installed machines to the internet. However, the report did not mention Iran enriching uranium to a purity of 60% close to weapon grade levels. Iran has informed the International Atomic Energy Agency that eight sets of advanced IR-6 centrifuges built in Fordo will enrich uranium to a maximum purity of 5%.

The Canadian government will increase investment in border security

According to reports, Canadian Prime Minister Trudeau met with provincial leaders on Wednesday evening and reached a consensus on Trump's commitment this week to impose a 25% tariff on all products from Mexico and Canada. The government will increase investment in border security.

The budget dispute in France has stirred up waves again. After Prime Minister Barnier's concessions, Le Pen has put forward more demands

After French Prime Minister Barnier abandoned plans to raise electricity taxes and made important concessions, Le Pen's National Union further proposed amendments to the French government's 2025 budget bill. I have listened to everyone's opinions, considered their opinions and priorities, "Barnier said in a speech on the future of small and medium-sized enterprises in Paris on Thursday. In response to this, National League President Jordan Bardella posted on platform X, stating that he had achieved a "victory" and made more demands. He called on Barnier to abandon plans to reduce drug reimbursements, to suspend any new or higher taxes, to help improve the competitiveness of small and medium-sized enterprises, and to link pensions to inflation from January 1st.

Hamas expresses willingness to reach ceasefire agreement with Israel, Gaza people hope for peace to come soon

After the ceasefire agreement between Hezbollah and Israel came into effect, the Palestinian Islamic Resistance Movement (Hamas) issued a statement on the 27th stating that Hamas is willing to cooperate with any efforts aimed at achieving a ceasefire in the Gaza Strip. On the same day, Hamas also stated that the current obstacle to reaching an agreement lies with the Israeli side. The statement aims to clarify Hamas' position on the ceasefire agreement between Hezbollah and Israel in Lebanon. Hamas is willing to cooperate with any efforts to promote a ceasefire in the Gaza Strip in order to ensure Israel's withdrawal from the Palestinian Gaza Strip, the return of displaced persons to their homes, and the completion of a genuine and thorough agreement on the exchange of detainees.

The German government plans to provide approximately 2 billion euros in new subsidies to the chip industry

The German government is preparing to provide billions of euros in new investment to the country's semiconductor industry. Two months ago, Intel shelved its plan to build a 30 billion euro (32 billion US dollars) chip factory in Magdeburg. Annika Einhorn, spokesperson for the German Ministry of Economy, stated in a statement on Thursday that the new funds will be provided to chip companies for the development of "modern production capacity significantly exceeding current technological levels". Two individuals who participated in this week's official event regarding the financing plan stated that the expected total subsidy is about 2 billion euros. Due to the non-public nature of the relevant discussions, informed sources requested anonymity. The German Ministry of Economy hopes to use the newly proposed funds to subsidize 10 to 15 projects in a range of fields, including the production of unprocessed wafers and microchip assembly.

EU and Ukraine sign memorandum of understanding to provide € 18.1 billion in aid to Ukraine

On November 28th local time, European Commission Executive Vice President Dombrovskis signed a memorandum of understanding on behalf of the EU with Ukraine, providing 18.1 billion euros in macro financial assistance to help Ukraine address its urgent needs.

US judge rules ExxonMobil's shutdown at Texas refinery legal

The administrative law judge of the National Labor Relations Board ruled that ExxonMobil's 10 month suspension of approximately 600 union workers at a Texas refinery during a contract dispute was a legal action. It is understood that the judge supported ExxonMobil in the ruling on November 21, stating that the shutdowns in 2021 and 2022 were intended to pressure the United Steelworkers Union (USW) to reach a final agreement, rather than to expel the union from the 369024 barrel per day refinery in Beaumont, Texas, or to force employees to dissolve the union.

US media: EU may cut foreign personnel due to budget constraints

On the 28th, US media revealed that due to tight budgets, the European Union may reduce the number of staff in its representative offices in Africa, Asia, and Latin America. According to internal documents cited by Politico, the European Union intends to adjust the size of its diplomatic missions and reduce the number of personnel in its missions to countries and regions in Africa, Asia, and Latin America. The EU has over 140 representative offices worldwide. An unnamed EU official told Politico that "we will leave very small delegations in countries such as Sudan and Niger," which is not correct, "especially at a time when the US government's interest in the outside world seems to be decreasing. Some EU officials are concerned that this measure may raise concerns about the EU losing diplomatic influence in regions such as Africa and Latin America. According to reports, the new European Commission and newly approved EU High Representative for Foreign Affairs and Security Policy, Kaya Karas, will discuss this measure in December.

China News

The People's Bank of China: October interbank bond market spot bond transactions amounted to 25.5 trillion yuan

According to data released by the People's Bank of China, in October, spot bonds in the inter-bank bond market traded 25.5 trillion yuan, with a daily average of 134089 billion yuan, an increase of 17.6% year on year and 1.2% month on month. Transactions with a single transaction volume of 5-50 million yuan account for 51.5% of the total transaction amount, while transactions with a single transaction volume of over 90 million yuan account for 42.2% of the total transaction amount, with an average single transaction volume of 40.763 million yuan. The trading volume of bonds in the exchange bond market is 3.5 trillion yuan, with an average daily trading volume of 196.38 billion yuan. There were 77000 transactions of commercial bank counter bonds, with a total transaction amount of 40.87 billion yuan.

Zhou Hongyi: Internet companies are no longer the main players in the AI era, but traditional enterprises are

At the "Shanxi Night" event of the 2024 World Zhejiang Business Conference, Zhou Hongyi, founder, chairman, and CEO of 360 Group, was invited to promote Linfen, Shanxi. Zhou Hongyi pointed out that in the AI era, when entering the second half of digitalization or the second half of the Internet, Internet companies are no longer the protagonists. The real protagonists are traditional enterprises. Therefore, for cities like Linfen, Shanxi, the biggest temptation for digital enterprises is that there are a large number of traditional enterprises, such as coking steel, who have very large space to carry out digital transformation.