Oil prices are edging higher again after falling around 20% over the last month in response to increasing recession fears. Inflation data on Wednesday didn’t help matters, with the market pricing in a strong possibility that the Fed moves up a gear and hikes 1% this month.
That saw crude prices slip further but soothing words from Bullard and Waller reassured everyone that 75 basis points remains the base case. Phew, just another 75 or two. Brent has moved back above $100 a barrel on those comforting words but promises to remain choppy amid a tight market and ongoing recession concerns.
Break Of $1,700 Would Be Psychological Blow
Gold has survived another assault on $1,700 today after briefly dipping below on Thursday. A stronger dollar and higher yields are wreaking havoc on the yellow metal, even in this risk-averse environment. The battle raging between inflation/interest rates and recession is creating quite the tug-of-war at times, and we may see that increase in the coming weeks, with the economy seemingly viewed as teetering on the edge amid current rate projections. A move below $1,700 would be a psychological blow, but $1,680 could be more significant.
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