The price of gold inched lower on Thursday, as the dollar and yields gained after the Fed reiterated its aggressive stance to fight inflation, while uncertainty over the war in Ukraine capped the metal’s losses.
Here’s how the prices of precious metals changed over the week:
The gold price went down 0.10% to $1,924.93 an ounce, silver dropped 1.44% to $24.34 an ounce, platinum fell 3.89% to $951.30, and palladium decreased 1.28% to $2,222.53.
⚠️ Inflation alert: Inflation in the Eurozone hit an all-time high of 7.5 percent in March, adding to the European Central Bank's policy challenge of combating spiraling prices without harming growth. (Politico)
“The war in Ukraine has exacerbated some recent price dynamics. The eurozone flash inflation reading surprised once again to the upside and confirmed the further acceleration,” said Oxford Economics economist Maddalena Martini.
Read our SPOTLIGHT to see how higher inflation can influence the gold price.
Surging inflation has people reconsidering how they spend their money. In fact, 48% of U.S. consumers are thinking about rising prices all the time, according to a CNBC + Acorns Invest in You survey, conducted by Momentive. (CNBC)
Inflation is costing the average U.S. household an extra $296 per month, according to a Moody’s Analytics analysis. Experts expect it to get worse before it gets better.
Oil rose on Wednesday as the threat of new sanctions against Russia raised supply concerns, countering fears of weaker oil demand. (CNBC, Reuters)
Brent crude futures rose to $1.07, or 1%, at $107.71 a barrel, having fallen to $105.06 earlier in the trading session.
The price increase comes as the United States and its allies prepared new sanctions on Moscow over civilian killings in northern Ukraine, which Kiev described as “war crimes.”
Read our SPOTLIGHT to learn why the prices of oil and gas are rising, and what could it mean for already high inflation.
Privacy issues: Coinbase and wallet provider MetaMask are ringing the alarm over privacy rules after the latest E.U. push to regulate crypto assets. (Barron’s)
European legislators approved draft rules that would give authorities access to information about the sender and recipient of all crypto transfers. The proposal would effectively make anonymous crypto payments illegal.
Russia is turning to Chinese microchip manufacturers to avoid Western sanctions, which have boosted demand for bank cards linked to the Mir payment system, an executive with Russia’s domestic payment system said. (Reuters)
Russia has been cut off from the global financial system, as well as nearly half of its $640 billion in gold and foreign exchange reserves, as a result of Western sanctions imposed in response to its invasion of Ukraine.
Opinion
Has the Fed made the U.S. recession inevitable? Well, it looks like it. (Bloomberg Opinion)
“The Fed’s application of its framework has left it behind the curve in controlling inflation. This, in turn, has made a hard landing virtually inevitable,” writes Bloomberg’s Bill Dudley.
Goldman Sachs sees a 35% risk of recession in the U.S. in 2022, up from just 10% last year.
What else is happening
The United States and European countries have promised to punish Russia for civilian deaths in northern Ukraine, where a mass grave and tied bodies of people shot at close range were discovered in a town retaken from Russian forces. (Reuters)
Following the deaths in Bucha, Ukraine, the United States announced it would impose a wide new batch of sanctions on Russia that includes first-time individual sanctions on the two adult daughters of Russian President Vladimir Putin.
Read our SPOTLIGHT to see what the current geopolitical tensions could mean for the global economy and gold price.
Putin has sought to increase the pressure on foreign buyers of natural gas, telling so-called “unfriendly” countries to pay in rubles from April 1— or have their supplies cut off. (CNBC, Reuters)
“Today I signed a decree that establishes the rules for trading Russian natural gas with the so-called ‘unfriendly’ states. We offer counter parties from such countries a clear and transparent scheme, in order to purchase Russian natural gas, they must open ruble accounts in Russian banks,” Putin said in a televised address.
However, Russia’s state-controlled gas giant Gazprom said it was continuing to supply natural gas to Europe via Ukraine, according to Reuters.
And finally…
🤯🪐 In a discovery that challenges the current understanding of the planetary formation, scientists have detected a massive planet nine times the mass of Jupiter at an incredibly early stage of formation. (Reuters)
"We think it is still very early on in its 'birthing' process. Evidence suggests that this is the earliest stage of formation ever observed for a gas giant,” said astrophysicist Thayne Currie of the Subaru Telescope and the NASA-Ames Research Center.
See you next week!
