Japan's December Rate Hike Comes into Effect: Gold Short-Term Pressure, Long-Term Upside Logic Intact

The upcoming rate hike by the Bank of Japan in December should be viewed from multiple dimensions regarding its impact on the gold market. In the short term, there may be volatility and downward pressure, but the fundamentals for long-term growth remain solid, with a clear and distinguishable core logic.

Currently, market consensus on Japan's December rate hike is highly unified. About 90% of economists and market pricing expect the central bank to raise interest rates by 25 basis points on December 18-19, from 0.5% to 0.75%. The key disagreement lies in the future rate hike path: the market generally expects rates to rise to 1.0% before September 2026, with a terminal rate possibly reaching 1.5%. However, Nomura Securities holds a different view, considering this expectation too aggressive, constrained by Japan's weak economic fundamentals and rising debt pressures. They predict a slower pace of rate increases, with rates only reaching 1.0% by January 2027.

Short-term negative shocks, but long-term support remains firm; risk of pressure-driven correction becomes apparent.

The rate hike in yen is highly likely to trigger carry trade unwinding, leading investors to sell gold to repay yen-denominated debts. Gold prices could see a 1.5%-3% phase correction. Additionally, profit-taking from previous long positions may further increase market volatility in the short term, keeping gold prices under pressure.

Long-term: The upward logic remains unbroken.

The medium- to long-term bullish fundamentals for gold are still solid, and the upward trend is unlikely to reverse. On one hand, Japan's economic fundamentals remain weak, with continuous declines in real wages, limiting the scope for further rate hikes, thus unlikely to exert long-term downward pressure on gold. On the other hand, the yen's rate hike leads to currency appreciation, indirectly weakening the dollar's strength. Coupled with persistent central bank gold purchases and the continued de-dollarization trend, these multiple positive factors reinforce the long-term foundation for gold's upside.

Long-term positioning advice

The long-term strategic approach remains unchanged. Investors can consider accumulating long positions in multiple batches below $4,200 per ounce, with stop-losses around the 20-day moving average, to steadily capture trend benefits and avoid short-term volatility risks. #Gate11月透明度报告出炉 #美联储降息 #广场发帖领$50 #XAUT