Dollar weakness provided light upwind as the dollar index is currently set at 91.54. The dollar traded at 92.21 on Monday and lost 67 points this week. As a result, the dollar index was devalued by -0.067% this week.
The US 10-year treasury bond traded lower this week and now yields about 1.56%. The decline this week also provided solid tailwinds that help the safe haven asset class.
On Wednesday, April 14, President Jerome Powell virtually spoke at the Washington DC Economic Club. He has raised the concerns of many economists about the growing national debt arising from fiscal stimulus, as well as the monetary policy of the Federal Reserve.
In response to these concerns, President Powell said that “the US federal budget is on an unsustainable path, which means that debt is growing significantly faster than the economy. The current debt level is very sustainable. And there is no question of our ability to service and issue that debt for the foreseeable future. ”
In addition, there is increasing tension between the United States and Russia. Yesterday, President Joe Biden signed an executive order that Russia has imposed with new sanctions based on information indicating that they are interfering with our election, as well as a greater amount of internet hacking and other ‘malicious activities’, including sending of additional troops to Ukraine as well as the continuation of persecution of Russian dissidents in detail to Alexei Navalny.
In response to these issues, the White House has issued an ‘Executive Order on the Blocking of Property in Relation to Specific Harmful Foreign Activities of the Government of the Russian Federation’. The full executive order can be read by following this link.
There is also increased tension with China. President Joe Biden met with Japanese Prime Minister Yoshihide Suga today. According to CNBC, “The two leaders will meet in Washington in what will be the US president’s first summit with a foreign leader since his inauguration in January. The meeting comes as the US seeks to challenge China on issues ranging from human rights to unfair trade practices. ”
These events together were the driving force behind moving gold and silver to gain value this week. Even if it is equal, they can continue to drive gold above $ 1800 per ounce and silver above $ 28 per ounce.
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I wish you, as always, good trade and good health,
Gary Wagner