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Market Review:
The Spread
AS we saw with CPI, there is a spread that has been created between the standard, and the core numbers. The standard number includes food and energy, and the core does not. On CPI the year over year standard number came in at 3.0% and the core number was 4.8%. That is a difference between the two of 1.8%. PPI is projected to show a greater spread. The standard number is expected to be 0.5%. The core number is expected to be around 2.8%. That spread is expected at 2.3%.
If you try to find where that spread is coming from, most of it appears to come from energy, specifically from crude. The Light Sweet Crude (CL) futures in June of last year hit a high at 123.68. The high of July 2022 was 111.45. The June high this year was 75.06. Already in July CL moved higher to 76.16. As the spread starts to diminish, we need to discover if the standard CPI and PPI rise, or if the core starts falling.
Gold futures (GC) opened the day at 1962.7. Yesterday's range was 1965.1 to 1937.5. Like most markets GC has already traded higher than yesterday's high. The way these markets are moving you should probably expect around 20 points of movement. The market needs to find some support after a very big move based on CPI yesterday.
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