Understanding the Market | Gold stocks collectively declined as the Federal Reserve's monetary policy stance leaned towards neutrality with a hawkish bias, leading to a short-term rise in gold prices followed by a pullback

Gold stocks collectively declined. As of the time of writing, China Gold International fell 3.01% to HKD 37.05; Lingbao Gold dropped 2.06% to HKD 2.85; Zijin Mining decreased 1.73% to HKD 14.76; and SD GOLD fell 1.35% to HKD 13.16. On the news front, the U.S. employment data released yesterday was weaker than expected, and Federal Reserve officials expressed a neutral to hawkish stance on monetary policy, leading to a short-term rise in gold prices followed by a pullback. Powell reiterated that due to the uncertain inflation outlook and the current robust economic performance, the Federal Reserve does not feel an urgent need for rapid interest rate cuts. Powell pointed out that the Federal Reserve can adopt a more cautious approach in seeking a "neutral interest rate"—a level that neither stimulates nor restricts economic activity. CITIC Securities' research report noted that since November, U.S. Treasury yields and the U.S. dollar index have significantly rebounded under the Trump trade, cooling expectations for interest rate cuts. Coupled with severe overbought technical conditions, gold prices have corrected from high levels, briefly dropping to around USD 2,500. In the medium term, with the U.S. economy and inflation slowing simultaneously, gold prices are likely to remain in a high-level fluctuation mode. In the short term, gold prices around USD 2,400 may be considered for additional allocation