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  • The Australian Dollar and New Zealand Dollar tend to rise with stocks. They have recently fallen despite gains in the #SP500. What does this mean for $AUDUSD and $NZDUSD ahead? #AUD #NZD #RBA #RBNZ - https://www.dailyfx.com/forex/fundamental/article/special_report/2020/01/17/AUDUSD-NZDUSD-Outlook-Looks-Past-Stocks-to-Rate-Cut-Bets.html?CHID=9&QPID=917702 https://t.co/ddf2fV7Kyl
  • A few snippets from today's commentary. Check out the link below for the full story (via @DailyFX). https://t.co/I31tuq764r https://t.co/x0BaiOFA1P
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  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 98.00%, while traders in France 40 are at opposite extremes with 79.59%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/UL7hqSD2Ki
  • US Dollar Forecast: $USD Lacking Impetus Ahead of Consumer Sentiment #Forex traders shift focus away from US-China trade deal headlines - perhaps toward the monthly release of #ConsumerSentiment data for volatility and clues on the Greenback's next move https://www.dailyfx.com/forex/fundamental/us_dollar_index/usd_trading_today/2020/01/16/us-dollar-forecast-usd-lacking-impetus-ahead-of-consumer-sentiment.html
  • Forex Update: As of 05:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.11% 🇦🇺AUD: -0.02% 🇯🇵JPY: -0.03% 🇨🇭CHF: -0.05% 🇬🇧GBP: -0.06% 🇨🇦CAD: -0.07% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/Kxcb9EtIWb
  • Indices Update: As of 05:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.45% France 40: 0.26% Wall Street: 0.07% US 500: 0.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/I5YIsKQAog
  • 🇯🇵 JPY Tertiary Industry Index (MoM) (NOV), Actual: 1.3% Expected: 1.0% Previous: -5.2% https://www.dailyfx.com/economic-calendar#2020-01-17
  • The $JPY has weakened as a bounce-back in risk appetite saps haven-asset demand. However, the old uptrend line still provides clear resistance. Get your market update from @DavidCottleFX HERE:https://t.co/IMhgQ9jbF9 https://t.co/I7087olftk
  • Heads Up:🇯🇵 JPY Tertiary Industry Index (MoM) (NOV) due at 04:30 GMT (15min), Actual: N/A Expected: 1.0% Previous: -4.6% https://www.dailyfx.com/economic-calendar#2020-01-17
Gold's Future Dependent not on Risk Trends but Sovereign Credit Fears

Gold's Future Dependent not on Risk Trends but Sovereign Credit Fears

2010-05-22 03:22:00
John Kicklighter, Chief Currency Strategist

Taking stock of the troubles that plague the finances of the world’s largest economies, there is plenty of reason to be concerned that governments will struggle to repay their obligations which will lead to a depreciation of their Treasury paper and currencies. However, it is one thing to erode confidence in something as liquid and seemingly-secure as these instruments and another to encourage investors to fully divest themselves. Government debt from the United States and United Kingdom are two of the most dependable yield-bearing investments in the world; and conditions would have to devolve a long way before large investors truly lost confidence in these assets. In fact, it seems there is very little chance that they will even lose their top credit rating any time in the near future. Alternatively, there are other nation’s that are further down the hole. Greece, Portugal and Spain have had their sovereign ratings cut and there have been warnings they could fall further. Yet, with austerity cuts being implemented and the 750 billion euro financial backstop in place, the European Union has at least bought itself some time. To truly unseat the markets, another major downgrade (or threat of a downgrade) will have to emerge. Japan may carry that burden. Deflation, credit troubles, anemic rates, demographic troubles and a dependence on exports is a set a problems that almost certain to produce a crisis unless global conditions turn robust in the near-future. Under any other conditions, an illiquid, expensive and volatile commodity does not make for a reliable alternative to Treasuries or established fiat currency.

What are some of the potential catalysts for these bigger themes next week? Underlying investor sentiment itself holds the greatest potential; but that will develop through momentum itself. The bigger themes for global fear are there; but they require some kind of spark themselves. From the economic docket, there is relatively little that can leverage a market wide panic or euphoria. Considering the growing doubt over the European Union’s continued existence, the European Commission and OECD’s June economic outlook survey may hold considerable sway over investors. Otherwise, the path will be defined by second readings of US and UK GDP, confidence surveys and inflation reports. - JK

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