In this article, we have covered the highlights of the most important news about the Gold Price range-bound market, the Russia Default, Crude oil declining, and the U.S. Dollar this week.
Gold Price Range-Bound
The gold price has been stuck in a range of US$ 1,807 – 1879 for the last five to seven weeks as rising interest rates, and inflation fears are weighing against the supposed safe-haven status of the precious metal.
The majority of global central banks are raising Gold Price rates, at a rate not seen in generations. It is to fight rapidly increasing inflation rates, and reverse the rather accommodating monetary and fiscal policy, indicating the long-term higher “Gold Prices”.
There is hardly any doubt that supply shocks have more than added to the fast Gold price hikes, with consumers running short of money fast to cope with the rising inflation.
Russia has defaulted on its Dollar-denominated sovereign debt for the first time in over one hundred years, as a result of tough Western sanctions, which made it impossible to use the payment routes to overseas creditors.
In this very usual situation, the country has the money to pay but is not able to process the payment due to sanctions imposed upon it. The Russian finance minister Anton Siluanov called the Russia Default a ‘farce’.
Crude Oil Declining
WTI crude oil is expected to decrease in price by more than 9% this month after increasing for the previous six months (June 2022). To witness a comparable drop in pricing, we would have to travel back to November 2021. On Wednesday just gone, oil reached its lowest level in the previous eight weeks. Is the downturn done or is a rebound imminent?
US Dollar looks neutral this week
Since Fed rate increases are not looking as hopeful, the surging US Dollar is seeking a short-term pause against this barrier.
Futures markets are also trying to give the Greenback a boost, since long positions are at their highest level since March 2017.
The US Dollar seems neutral for the last week of June 2022, according to the IG Client Sentiment Index.
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