The dollar and the euro, the world’s two most-traded currencies, are now less than one penny away from reaching parity for the first time since 2002. Business Insider reports that on Monday, the euro exchange rate with the dollar was at $1.009, down about 15% in the last 12 months. In other news, more and more market experts are saying that gold, and other precious metals, are poised for a comeback. Bloomberg Intelligence Senior Commodity Strategist Mike McGlone said gold could soon see a $2,000 flashback. In his mid-year outlook, he wrote, “Gold’s moribund performance is clearly different from past high-velocity commodity rallies. But the metal looks poised to come out ahead … Juxtaposed on the chart is gold hovering around its 100-week mean for almost a year. Our take: Gold is trend ready, while broad commodities risk reversion to their historic mean,” McGlone wrote. “The last similar period of sluggish gold vs. strong commodities was in 2000 as the internet bubble burst and the precious metal jumped into an extended bull market.”
Business Insider/Phil Rosen
The dollar and euro are less than a penny away from reaching parity for the first time in 20 years
The world’s two most traded currencies are less than one penny away from reaching parity for the first time since 2002.
On Monday, the euro exchange rate was down 0.9% to $1.009. And over the last 12 months, the euro has fallen 15% against the dollar.
Compared to the European Central Bank, the Federal Reserve has been hiking interest rates at an aggressive pace, pushing yields on US Treasury Bonds higher than those on European bonds and sending investors flocking to the dollar.
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Kitco News/Anna Golubova
Gold price could see ‘2000 flashback’ as most commodities reverse in second half of 2022 – Bloomberg Intelligence
Despite gold kicking off the second half of the year with a drop below $1,800 an ounce, Bloomberg Intelligence sees the precious metal moving higher versus broader commodities, which are at risk of a reversal.
Crude oil is the commodity facing the biggest reversion risk in the second half of 2022, while gold is among the few that could benefit and see the $2,000 an ounce levels again, according to Bloomberg Intelligence senior commodity strategist Mike McGlone.
“The great reversion of 2022 may gain momentum in 2H, and crude oil seems a top candidate to drop. We see 2H risks tilted toward accelerating retracement in the Bloomberg Commodity Index, with gold potentially a primary standout,” McGlone said in his mid-year outlook.
You can read the full article, here.
Can commodities make a comeback?
Mixed market signals are presenting a confusing narrative for investors trying to pinpoint peak inflation. With recent drops in crude prices and industrial metals like copper and aluminum tumbling, many are looking to commodities for a better glimpse of the macroeconomic picture.
Commodity prices have slid this year amid rising interest rates, with the Invesco DB Base Metals Fund (DBB) dipping to a 52-week low on Tuesday.
“If you look at all the major commodity prices around the world, all are now back or below where they were [in late February] when Russia invaded Ukraine,” Will Rhind, CEO of GraniteShares, told Seema Mody in an interview on CNBC’s “ETF Edge” on Wednesday. Iron ore is the one major exception.
Keep reading, here.