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Gold Feb '24 (GCG24)

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Gold Futures Market News and Commentary

Dollar Rallies and Gold Plunges as Iran War Continues

The dollar index (DXY00) today is up by +0.43%.  Today's sharp drop in equity markets has boosted liquidity demand for the dollar.  Also, Wednesday night's comments from President Trump that the Iran war could escalate have boosted demand for the dollar as a safe-haven.  The dollar added to its gains today on better-than-expected US economic news on weekly jobless claims and the Feb trade deficit.

During a speech to the American public on Wednesday evening, Mr. Trump pledged more aggressive action against Iran over the next two to three weeks and offered no concrete plans to reopen the Strait of Hormuz. 

US weekly initial unemployment claims unexpectedly fell -9,000 to a 2.5-month low of 202,000, showing a stronger labor market than expectations of an increase to 212,000.

The US Feb trade deficit was -$57.3 billion, narrower than expectations of -$60.6 billion.

Swaps markets are discounting the odds at 1% for a +25 bp rate hike at the April 28-29 FOMC meeting... Read more

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