Observing news today one can easily get disappointed. However, things are getting better.
Gold heads south for the third session as greenback gains
On Tuesday, gold slumped because the major US currency rebounded from a three-year minimum, while market participants wait for the minutes of the last Fed gathering.
Trading volumes were supposed to stay thin because on Monday Wall Street was unavailable due to a holiday.
Comex gold futures declined 0.88% being worth $1,344.30 per troy ounce.
The evergreen buck was underpinned by the American homebuilding data, which was published on Friday. According to the report, in January homebuilding in this country soared to more than a one-year maximum, while building permits climbed up to their highest value since 2007. The previous week’s higher-than-anticipated consumer price surge was considered to be just another tailwind.
The US dollar index, normally employed to gauge the US currency against a group of its key rivals, was seen at 89.28, adding 0.22%.
The evergreen buck has been declining for recent months because inflation worries in the face of the ideas that the key US financial institution along with other major banks might have rates lifted were cited as the number one reason for the evergreen buck’s underperformance.
The previous month, Steven Mnuchin, US Treasury Secretary told that a weaker greenback policy pursued by the Fed could be quite good especially considering America’s trade deficit is making its way to a 10-year maximum.
Any shifts in the US currency, not to mention the greenback have a powerful impact on gold. It’s because for keepers of foreign currency gold becomes less affordable due to a strengthening greenback. As for interest rates’ influence, the opportunity cost of keeping non-yielding assets is what they increase.
As for Asian equities, they were mixed during the morning trade. The Nikkei along with the S&P/ASX 200 dived respectively 1.1% and 0.2%. At the same time the Hang Seng Index rallied 0.5%.
XAU/USD reversed down from the $1,700 area and dropped to $1,586 on March 12.
Oil market crashed after OPEC+ didn’t agree on production cuts. What’s next? Let’s see what bank analysts have to say about this.
WTI oil prices jumped up after Donald Trump’s 2 tweets
Today the US nonfarm payroll data will be reported that could cause fluctuations of the market.
WTI was at $20 per barrel just in the beginning of the day. Currently - above 25$.