Week Ahead: Gold could push closer to $2000 on heightened Ukraine crisis fears
The start of March is set to be accompanied by a broad swath of major market events that are set to influence various asset classes.
The ongoing Russian invasion of the Ukraine will almost certainly cast a dark cloud over the upcoming OPEC+ meeting, central bank decisions, and even US President Joe Biden’s first State of the Union address.
Here are the scheduled major events and data releases due in the coming week:
Monday, February 28
- AUD: Australia January retail sales and February inflation
- EUR: ECB member Fabio Panetta speech
- USD: Fed speak – Atlanta Fed President Raphael Bostic
Tuesday, March 1
- CNH: China manufacturing and non-manufacturing PMIs
- AUD: Reserve Bank of Australia rate decision
- CAD: Canada December GDP
- EUR: Eurozone Markit February manufacturing PMI
- GBP: UK Markit February manufacturing PMI
- GBP: BOE MPC members Catherine Mann and Michael Saunders speeches
- USD: Fed speak – Atlanta Fed President Raphael Bostic
- US President Joe Biden’s State of the Union
Wednesday, March 2
- AUD: Australia 4Q GDP
- Brent: OPEC+ meeting
- EUR: Eurozone February CPI, Germany February unemployment, ECB Chief Economist Philip Lane speech
- GBP: BOE’s Silvana Tenreyo and Jon Cunliffe speeches
- USD: Fed speak
- Fed Chair Jerome Powell testifies before the House Financial Services Committee
- Chicago Fed President Charles Evans
- St. Louis Fed President James Bullard
- New York Fed Executive Fed President Lorie Logan
- US crude: EIA weekly US crude inventories
- CAD: Bank of Canada rate decision
Thursday, March 3
- CNH: China Caixin composite and services PMIs
- EUR: Eurozone January unemployment, February Markit services and composite PMIs, and ECB minutes
- USD: Weekly jobless claims
- USD: Fed speak – Fed Chair Jerome Powell testifies before Senate Banking Committee, New York Fed President John Williams’s speech
Friday, February 25
- EUR: Eurozone January retail sales, Germany’s January external trade
- USD: US February jobs report
- Apple hosts annual shareholders meeting
Amid lingering fears over an escalation in Europe’s worst security crisis in decades, which could set back the global economic recovery and ramp up inflationary pressures, safe havens are expected to remain well bid amid a persisting risk-off environment.
Gold’s brief spike past $1970, which was the highest spot price for bullion since September 2020, may be a sign of things to come from bullion bugs.
Bullion backed ETFs have already made net purchases of nearly 2.4 million ounces of the precious metal so far this year. Such has been the clamour for gold as a safe haven that spot prices have managed to shrug off the prospects of rising real yields, with Fed members on Thursday reiterating their plans to raise interest rates despite the heightened risks stemming from the Ukraine crisis, to boast a year-to-date advance of over 4.5% at the time of writing. Markets are wary that further climbs in commodity prices could feed the inflation beast and ramp up stagflation risks, which in turn could give major pause to major central banks over plans to normalize their respective policy settings.
With all that in mind, bullion bugs may have little qualm revisiting the upper-$1900 range on perhaps still-escalating tensions between Russia and the West.
