Risk appetite remains limited as the war in Ukraine intensifies. The price of US crude eased below the $110 per barrel yesterday then jump back above $114, on reports that smoke was visible from a nuclear power plant in Ukraine.

The market mood is deep red. The European stocks continue feeling the pinch of an escalating war, as the US major indices remain under decent selling pressure, with the fading optimism about Jerome Powell’s announcement that he would back a 25bp hike in March meeting. S dollar, gold and commodities remain in demand. Commodities had their best week since 1974.

However, if things get bad enough to push investors to close their positions, then the US dollar would be, by far, the best hedge.

Bitcoin, on the other hand, is giving back the early week gains as it becomes clearer by the day that it won’t be a hassle-free safe haven to investors, as the Western forces are going after the coin to impose strict regulations to prevent Russians from going around the sanctions that are imposed to them.

The US NFP data is due today, but the number matters little unless there is a big negative surprise. What really matters is the average hourly earnings which is expected to have risen to 5.8% year-on-year, and which would mean a higher and sustainable pressure on inflation.

 

This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.

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