Gold rallies amid inflation and recession concerns

News of the day, Tuesday, April 19

Gold rises as investors strive for a safe-haven asset amid intensifying military assault in Ukraine and soaring U.S. inflation and recession risks. Gold has reached 6-week highs trading slightly below $2000. At the same time, the Dollar Index broke above 100 for the first time since the COVID-19 pandemic started, while usually in moves inversely to gold prices. 

“There’s a degree of both economic and political concerns in today’s gold rally as the geopolitical implications from Ukraine can escalate out of nowhere, but I think inflation is the bigger factor over concerns that an aggressive Fed response could tip the US economy into recession. Also, the inverse dollar-gold relationship is not a given. What’s more important is how worried investors are about things, and all focus now is whether we will avoid a recession.” said Phillip Streible, precious metals strategist at Blue Line Futures in Chicago.

Apollo Global Management Inc. is interested in financing the bid for Twitter Inc. after the recent refusal of Elon Musk’s $43 billion offer to take the company private. Apollo considers backing the supposed deal for Twitter and can provide a private-equity firm Thoma Bravo LP or Elon Musk with equity or debt to support an offer.

The price of Brent crude is $111.60, WTI — $106.10, GBP/USD — 1.3037, EUR/USD — 1.0803, and gold costs $1978.10 per ounce.