Spot gold is trading around $1,927 a troy ounce, still incapable to attract market participants as per trading in quite a limited intraday range. XAUUSD has been flat for over a week, with daily candles showing little to no bodies, as the risk-averse environment boosts demand for both safe-haven assets.
The US Dollar is stronger on Wednesday amid inflation-related concerns and mounting tensions between Western nations and Russia. The US has imposed full blocking sanctions on Russia’s Sberbank and Alfa Bank, which will dramatically escalate the financial shock on Moscow as these giants of the latter holds more than one-third assets of Russia. The war, which worsens supply chains, is putting more pressure on already high inflation. In turn, central bankers from around the globe are tightening their monetary policies.
At the same time, government bond yields soar, while the yield-curve hints at recession. The yield on the 10-year US Treasury peaked at 2.66%, its highest since early 2019. Stocks, on the other hand, are on the backfoot, with US indexes reaching fresh weekly lows.
The US dollar index is targeting the psychological resistance of 100 amid fresh sanctions on Russia by the US administration, which has triggered the negative market sentiment. Looking forward for today are speeches from FOMC and Yellen but also the US unemployment claims.
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