USD / CAD – October 2022: FX Outlook Economic Outlook and Summary

The US dollar ruled in September. Fear of the Fed fueled broad based US dollar demand, sent Wall Street stocks tumbling until the last few days of the month.

That’s when the British pound took over the driver’s seat for global market direction.

The UK government released a “mini budget” that included tax cuts for high income earners while simultaneously boosting spending.

Traders were seriously unimpressed and voted with their wallets. GBPUSD plunged from 1.1274 at the peak on Friday September 23, before the budget, to 1.0349 at the trough in the wake of the news on September 26. British government bond prices collapsed sending the 10-year Gilt yield to 4.215%, the highest level in a dozen years. The US 10-year Treasury yield climbed above 4.0% in sympathy.

The soaring Gilt yields forced the Bank of England to intervene in the bond market to prevent UK pension plans going bankrupt … Read more

Five Top Ways to Trade the Recovery in Gold Prices

Gold prices are starting to push aggressively higher. All as the dollar and U.S. Treasury yields retreat, with investors hoping the Federal Reserve will ease off of its aggressive approach to interest rate hikes. In fact, ING’s head of commodity strategy, Warren Patterson says, “Any hints of an easing in its aggressive hiking cycle should start to provide some support to gold prices. And in order for this to happen, we would likely need to see some clear signs of a significant decline in inflation,” as quoted by Kitco.com. In addition, “ING sees inflation coming down ‘quite drastically’ in 2023, allowing the Fed to start cutting rates in the second half of 2023.” Should that happen, gold prices could push higher, taking gold stocks along for the ride, including NevGold Corp. (TSXV: NAU) (OTCQX: NAUFF), Barrick Gold Corporation (NYSE: GOLD) (TSX: ABX), Newmont Corporation (NYSE: NEM) (TSX: NGT), Read more