Gold Price News and Forecast: XAU/USD - Why is gold not rallying whilst the dollar is selling off?

FXStreet Team FXStreet

Sweden Ends Its Experiment with Negative Interest Rates, Should Gold Be Worried?

In December, the SverigesRiksbank, the world’s oldest central bank, has raised the main interest rate from -0.25 percent back to zero, ending its experiment with the negative interest rate policy, as the chart below shows.

This is a huge change. As a reminder, Riksbank was a pioneer of negative interest rates. As early as in 2009, it moved the overnight deposit rate below zero. Then, in 2015, the Swedish central bank cut its main interest rate, the repo rate, to -0.10, worried about the repercussions of the sovereign debt crisis in the euro zone. In 2016, Riksbank was forced to go further, setting the interest rates as low as -0.50 percent, to prevent a Japanese-style deflationary spiral in Sweden.

Why is gold not rallying whilst the dollar is selling off? [Video]

There are a few quandaries facing gold right now. Why is gold not rallying during this massive risk sell-off? Why is gold not rallying whilst the dollar is selling off? The momentum of the gold bull run played out last week, moving well into overbought territory on RSI. Since then the market has been unwinding. The reaction during yesterday’s session, where gold turned back from $1660, just shows that the bulls have run out of steam and profit-taking has hit again.

AUD/USD consolidates above 0.7200 after hot Chinese CPI data

AUD/USD is extending its consolidative price action above 0.7200 during the Asian session on Wednesday, uninspired by hot Chinese CPI and PPI data. Meanwhile, rising RBA rate-hike bets act as a tailwind for the Aussie amid Yen-inspired US Dollar weakness. Traders await the release of US inflation figures later in the week for fresh impetus.

USD/JPY: Bearish impulse falters around 153.00

USD/JPY remains under pressure, down for the third consecutive day on Wednesday, and trading in levels last seen in mid-February near 153.00. Solid Japanese data earlier in the day seem to have reinforced expectations that the BoJ will continue normalising monetary policy, lending further support to the Yen.

Gold regains balance above $4,400

Gold rebounds on Wednesday, snapping a three-day losing streak and reclaiming the are beyond the key $4,400 mark per troy ounce. The precious metal’s bounce comes amid further selling pressure on the US Dollar and steady uncertainty on the geopolitical front.

Pi Network's rebound holds as momentum improves

Pi Network (PI) extends its recovery on Wednesday, trading above $0.098 after finding support around the 50-day Exponential Moving Average earlier this week. The rebound comes as the Pi Core Team highlights the importance of strengthening its developer ecosystem to expand application-level utility across the network.

Oil, Apple and JPY in focus

Oil prices are rising on Wednesday as tit-for-tat strikes between Iran and the US threaten oil supplies as the two sides battle for control of the Strait of Hormuz. Stock futures have switched their attention from a strong earnings season to the challenges ahead, including a 10-year Treasury yield that is hovering close to the 4.8% level.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.