Gold Prices Hampered amid Inflation Concerns| Influencer‘s Insight •Jasper Lo




Commodity prices and the Commodity Research Bureau (CRB) Index have been surging since the beginning of the year, or even since the middle of last year. Commodities include crude oil, natural gas, soybean, wheat, sugar, cotton, corn, hogs, cattle, copper, aluminum, iron ore, etc., all have risen sharply attributed to the market‘s expectation of economic recovery. In terms of the CRB Index, it has gained nearly 10% year-to-date, while the growth is as large as 77.61% if be calculated on the rebound from last year’s April low of 112.85 to the current 200.44.

With that said, the US inflation prints are getting more and more buoyant. It is no wonder the US expects a rate growth in December with a chance ranging from 6% to 11%, according to the Chicago Mercantile Exchange‘s interest rate futures, which reflect market expectations for the US interest rates. Concerns about the Fed’s rate hike in the next year are emerging in financial markets. But in my opinion, what the interest rate futures reflect is the chance that the Fed exits the market because it will be the first step before raising rates. If the economic indicators continue gathering pace, an era of high inflation could be imminent. On the contrary, negative growth in the data will lead to stagflation. While the former is favorable to the dollar, the latter could hamper it to a high degree.

Based on the analysis of the US recent economic data, I believe the former will come true. Thats why the forex market repeatedly sees a constructive DXY. The US 10-Year Treasury yield coincides with the rising DXY, punishing the gold alone among the commodities. Moreover, the virtual currencies have attracted many capital inflows from the gold market with their extremely bullish momentum, which weighs on gold prices further. Gold prices slipped to $1,760 last Friday before embracing a technical rebound. But gains from the rally are expected to be trimmed continuously amid the above downbeat news. Gold will struggle to find support at the $1,700 psychological level if it breaches below the $1,760 barrier.
Latest News
-
Dollar Up but Near Three-Week Low as Investors Await U.S. CPI Figure
WikiFX | News 1618295813000
-
Lessons Given by Losses Worth 2 Million in Forex Market!
WikiFX | News 1618295392000
-
BIG THING!!! Phone Credits Giveaway Starting From TODAY
WikiFX | News 1618292254000
-
Daily Forex Analysis - 13 April 2021
WikiFX | News 1618285540000
-
Why the South African Rand Is Strengthening?
WikiFX | News 1618301353000
-
A 400% Jump in Crypto Scams in Canada
WikiFX | News 1618296372000
-
GBP/USD Calls For Bullish Reversal Near 1.3670 Support
WikiFX | News 1618364221000
-
USD/JPY bears on top in Tokyo open
WikiFX | News 1618364480000
-
Bitcoin Rallies to All-time High as All Eyes on Coinbase Listing
WikiFX | News 1618365342000
-
Daily Forex Analysis - 14 April 2021
WikiFX | News 1618371206000
South African Rand
- United Arab Emirates Dirham
- Australia Dollar
- Canadian Dollar
- Swiss Franc
- Chinese Yuan
- Danish Krone
- Euro
- British Pound
- Hong Kong Dollar
- Hungarian Forint
- Japanese Yen
- South Korean Won
- Mexican Peso
- Malaysian Ringgit
- Norwegian Krone
- New Zealand Dollar
- Polish Zloty
- Russian Ruble
- Saudi Arabian Riyal
- Swedish Krona
- Singapore Dollar
- Thai Baht
- Turkish Lira
- United States Dollar
- South African Rand

United States Dollar
- United Arab Emirates Dirham
- Australia Dollar
- Canadian Dollar
- Swiss Franc
- Chinese Yuan
- Danish Krone
- Euro
- British Pound
- Hong Kong Dollar
- Hungarian Forint
- Japanese Yen
- South Korean Won
- Mexican Peso
- Malaysian Ringgit
- Norwegian Krone
- New Zealand Dollar
- Polish Zloty
- Russian Ruble
- Saudi Arabian Riyal
- Swedish Krona
- Singapore Dollar
- Thai Baht
- Turkish Lira
- United States Dollar
- South African Rand
- Amount
- South African Rand
- Available
- -- United States Dollar