Markets were rocked by another Ukrainian drama on Tuesday, with Europe, the United Kingdom and the United States putting two former Soviet-backed and Donetsk and Luhansk regions of Ukraine, Russia, in place, to threaten Russia with its first sanctions. It could strategically allow Russia to increase its military.
Traditional Hen Gold opened the day with a soft spot, but Ukrainian President Volodymyr Zelinsky said there would be no war or expansion with Russia and that bullshit pressure would soon subside before the price drops to $ 1,916 in June. The lowest after $ 1,891. Of course, it has called for sanctions against its foreign partners, and some have declared sanctions on Russian banks and individuals, including the United Kingdom, and the European Union is set to announce its own defense measures later today, in particular the Nord Stream 2 pipeline. The reality is that defense measures, especially in the absence of a formal invasion, need to be addressed in terms of Europe’s dependence on energy. Therefore, the severity of the penalties will determine the amount of gold mining in the coming days or weeks.
The euro will reduce losses but the pound is still weak.
Among other assets, bond markets have relinquished some of their land holdings by reversing 10-year treasury production by more than 1.90 percent. As the risk increased slightly, European production recovered rapidly. The latter is evident in the FX and stock markets. Although the geopolitical influence on the currency is relatively small, the euro has reacted quickly to new encouraging headlines, from the low of 1.1280 to 1.1366. The European Union (EU) has provided significant assistance to Germany’s Efo Trade Climate Index, which indicates that it will benefit greatly from the Corona virus crisis.
Under the pressure of the yen, the dollar rebounded around the 114.70 key support, although the 115.00 number remains a key obstacle.
On the other hand, the pound still shows no strong appetite for the dollar and the yen. Comments from BOE policymaker Dave Ramsden, which may have supported only a modest monetary stimulus in the coming months, have canceled any of the upside as the expected pace has slowed to 50 bps. The pound last traded lower at 1.3547, the yen more or less stable at 155.88. The euro rose sharply to 0.8382, signaling a four-day losing streak.
RBNZ to increase rates for the third time
The New Zealand Reserve Bank (RBNZ) will pay special attention to the New Zealand dollar when it announces its policy decision early Wednesday during Asian trading hours. Investors are confident that the Central Bank will offer a third consecutive 25 bps increase, with a 30% chance of a 50 bps increase. Therefore, unless the RBNZ moves at a speed of 50 BPS to tackle rapid inflation and / or does not use optimism to predict the future of the economy, the announcement of the policy itself may be a sell-out. Dollar, closing the road above the strong 0.6730 resistance.
Stock sales have stopped, oil has reached a new high
In fairness, the European indexes averted the downturn in Asia, offsetting previous losses by traders turning a currency into a safe haven during the day. Energy, real estate, and consumer cycling stocks performed well. Futures are looking at the S&P 500, the Nasdaq 100 and the Dow Jones Index to a lesser negative.
Finally, Oil continues to make headlines. International benchmark Brent Crude is close to hitting a critical $ 100 / barrel before sliding to $ 97.42, and WTI Crude raises Monday’s rally to a new seven-year high of $ 94.90, raising fears that global inflation could continue. While progress on Iran-US nuclear talks could be a major blow to the oil race, another supply shock threatens to escalate into a full-blown war in Ukraine.