Gold Nears Record Highs Despite Fed's Hawkish Stance on Rates
Published: Wednesday, 17 April 2024 09:15 | 
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Gold prices have held steady near record levels this year, gaining about 15% amidst ongoing geopolitical tensions in the Middle East and Ukraine. Despite a recent statement by Federal Reserve Chairman Jerome Powell indicating that interest rates might remain higher for an extended period due to persistent inflation, gold continues to attract safe-haven investments. This resilience comes even as Treasury yields and the dollar have risen, which typically dampens gold's appeal. The metal's sustained uptrend, in the face of higher borrowing costs and a stronger dollar, has caught the attention of market analysts.
UBS Positive on Gold, May Rise to $2,500
Published: Wednesday, 17 April 2024 08:53 | |
| Dominic Schnider, head of global commodities and foreign exchange at UBS Global Wealth Management, discusses the prospects for commodities including copper, gold and silver. He speaks on "Bloomberg: The China Show." Source: Bloomberg
Investors Flock to Gold as Middle East Tensions Escalate, Dollar Tumbles
Published: Wednesday, 17 April 2024 08:42 | |
| Gold prices saw an increase on Wednesday, nearly touching their all-time highs, due to escalating tensions in the Middle East and a weakening U.S. dollar. The price of spot gold ascended by 0.2% to $2,388.56 per ounce, approaching its historical peak of $2,431.29. Conversely, U.S. gold futures experienced a slight decline of 0.1%, settling at $2,404.90. The rise in gold prices reflects investor sentiment seeking security amid growing geopolitical concerns, despite being technically overbought. Lukman Otunuga, a senior research analyst at FXTM, highlighted that the geopolitical instability is currently more influential on market dynamics than economic data or monetary policy expectations.
446 Days and Counting: Recession Signal Fails to Predict Economic Downturn
Published: Tuesday, 16 April 2024 05:05 | |
| For 446 days, the bond market's yield curve inversion, often seen as a recession predictor, has not resulted in an economic downturn. Historically, a normal yield curve shows higher long-term rates compared to short-term ones, indicating economic optimism. However, since July 5, 2022, the 2-year Treasury yield has consistently exceeded the 10-year rate, primarily due to aggressive Federal Reserve rate hikes aimed at curbing inflation. This condition matches the length of a similar inversion from 1978 to 1980 but has yet to lead to the anticipated recession.
Debt Service Costs Threaten Sustainable Development in Developing Countries
Published: Tuesday, 16 April 2024 04:52 | |
| Emerging nations are facing a severe financial dilemma as they contend with record-high external debt service costs of $400 billion this year. A recent report by the Debt Relief for Green and Inclusive Recovery Project (DRGR) highlights that 47 developing countries risk insolvency if they pursue necessary investments in climate adaptation and sustainable development to meet the 2030 Agenda and Paris Agreement objectives. This risk arises as these investments would push them beyond the external debt insolvency thresholds set by the International Monetary Fund (IMF), particularly over the next five years.