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Gold Dec '21 (GCZ21)

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Gold Futures Market News and Commentary

Dollar Supported by Ongoing US-Iran War

The dollar index (DXY00) on Wednesday rose by +0.22%.  The dollar recovered from early losses on Wednesday and moved higher after Iran said it rejected the latest US peace proposal. Also, Wednesday's US economic news, showing the Feb import price index ex-petroleum posting its biggest increase in 4 years, is hawkish for Fed policy and supportive of the dollar.

The dollar initially moved lower on Wednesday as stocks rallied after the Trump administration stepped up efforts to end the war with Iran and sent Iran a 15-point peace proposal to end the hostilities.  Also, Wednesday's 2% fall in crude oil prices may curb price pressures and allow the Fed to keep cutting interest rates, a bearish factor for the dollar.

US MBA mortgage applications fell -10.5% in the week ended March 20, with the mortgage purchase sub-index down -5.4% and the refinancing mortgage sub-index down -14.6%.  The average 30-year fixed rate mortgage rose +13 bp to 6.43% from 6.30% the prior week.

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