Gold weighed down by a stronger dollar, Fed hawkishness, China lockdowns
Blain says the markets are ‘significantly underestimating’ Ukraine consequences

(USAGOLD – 4/25/2022) – Gold continued its decline this morning, weighed down by a stronger dollar, perceived Fed hawkishness, and growing concern over the lockdowns in China. It is down $23 at $1911. Silver is down 53¢ at $23.69. Despite the market weakness (or perhaps because of it), Saxo Bank’s Ole Hansen reports strong demand for the metal coming from “asset managers seeking protection against rising inflation, lower growth, geopolitical uncertainties as well as elevated volatility in stocks and not least bonds.” The net effect over the past week has been a gradual slide in gold and a much steeper one in silver as investors attempt to sort out the conflicting signals. Shard Capital’s Bill Blain is convinced that the markets are “significantly underestimating how the rollover from Ukraine consequences will hit the global economy.”

“The waves of tectonic economic instability unleashed by the Ukraine conflict,” he writes in a recent advisory, “have shocked and caught the global commentariat of politicians, central bankers, economists and investment analysts off guard. Inflation from agribusinesses, energy and supply chains is spinning unchecked – and, like a nuclear reaction, they are triggering a host of follow up consequences. It feels a little bit Chernobyl – the reactor is going critical! Our cosy assumptions about how the interconnected globalised economy was supposed to work are being rocked to the core.”