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Markets make sense across assets in light of central bank moves

Posted by WorldWideMarkets . on May 21, 2013 3:39:00 AM

rand, brent, dollar, yen, Fed, Federal Reserve, BernankeThe fluctuations in the dollar and that impact on other currencies are being blamed for all sorts of issues in cross asset classes and even social unrest. In metals, some blamed silver’s 7 percent slump on Monday to its lowest since 2010 on the yen rally. The fall in Brent was partly attributed to the dollar’s continued strength even as it fell on Monday. Gold slid for the 8th straight session on Monday to a level not seen in over a month as expectations the Fed will either exit QE or at least slow it down continue to weigh on investor sentiment by pushing the dollar higher. Spot gold has already gone into bear mode despite problems with supply as mine workers in South Africa demand big wage hikes to offset inflation. The rand is hovering near a four year as the dollar strength impacts the South African unit directly and helps push gold lower.  Of course, the rand fall only adds to inflationary pressure and will further stoke wage demands. The dollar/rand has broken through the 20-day upper Bollinger band four days running. Watch the Ben Bernanke, the Fed and the BOJ closely. 

 

 

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