Trying to understand the mechanism here, not asking for trading advice.

    A few sessions ago, lower oil and hopes of further talks seemed to weaken the dollar and support gold. But once oil bounced back, the dollar seemed to regain support quickly, while gold still looked more mixed than straightforwardly strong.

    Is the cleanest explanation that higher oil feeds faster into inflation expectations and safe-haven dollar demand, while gold gets pulled in two directions at once, helped by uncertainty but capped by the idea of higher-for-longer rates?

    I’m curious whether this is mainly an inflation channel, a liquidity/safe-haven channel, or both.

    Why does oil bouncing back seem to strengthen the dollar faster than it boosts gold?
    byu/Zestyclose_Mail_4569 inAskEconomics



    Posted by Zestyclose_Mail_4569

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