It is hard to determine what is in control of global investors’ fears or appetites. That is owing to a number of competing issues ranging from monetary policy being ramped to extremes, recession fears popping up in headlines regularly and now very clear political pressures like Brexit and a US impeachment inquiry. Yet, we can prioritize for the week ahead.
Gold prices may be torn between the downward pressure of positive US economic data and the upward force of trade war uncertainty and its impact on Fed rate cut bets.
The chance of an Australian rate cut this week is now very high, the market believes, and it’s probably right. However, the RBA may not be as sure about a further reduction.
Crude oil is down 5% on the week and by over 12% in the last two weeks as global growth fears and politics weigh on oil.
Politics outweighing the economics as equity markets close the week broadly in the red.
Crude Oil Futures – Black
Gold – Yellow
DXY – Green