Gold again above $ 1800

The price of gold seems to draw a very interesting pattern, from the point of view of the chart analysis. From the fundamental point of view, it may also look interesting, as the world is plunged by ever higher inflation, the specter of stagflation and the impact of the coronavirus on the economy and the valuation of the US rate hike cycle.

The gold market and the coronavirus

Gold appears to rise above $ 1800 an ounce on Thursday, after a jump of almost 1%. during the previous session. The price increase could have been driven mainly by the weaker dollar. The US currency index plunged on Wednesday on renewed economic optimism and an increase in risk appetite, despite the spread of a new strain of the coronavirus: Omikron.

A South African study suggests a reduced risk of hospitalization and severe illness in people infected with this variant. The U.S. Food and Drug Administration (FDA) also issued emergency approval for Covid's emergency pill on Wednesday Pfizer, the first authorized oral antiviral drug during a pandemic. These events could improve market sentiment, prompting investors to position themselves from a safe dollar towards more risky assets. A weaker dollar, on the other hand, may make gold cheaper for buyers who have non-US currencies, which may increase its attractiveness.

The appetite for risk increases, and oil becomes more expensive

Interesting developments also seem to be taking place in the oil market. Futures on WTI oil rose on Wednesday to more than $ 72,5 a barrel after they jumped more than 3,5 percent. during the previous session, due to a greater than expected decline in US crude oil inventories and the energy crisis in Europe. A slight improvement in risk appetite could also have contributed to the gains, as traders are more positive about the global economic recovery.

American Petroleum Institute Crude oil inventories fell last week by 3,67mn barrels above market expectations of 2,63mn, it said on Tuesday. At the same time, natural gas prices in Europe rose after Russia restricted flows, forcing some countries to increase their electricity imports and burn oil to meet demand.