– As emerging market currencies internationally collapse in value, there is a real risk of contagion in bond and currency markets
– Turkish lira falls 43.6% and Argentine peso falls 51% and are respectively the 2nd worst and worst internationally traded and non pegged performing currencies in 2018
– Venezuelan bolivar has completely collapsed
– Inflation is going to take off as wheat has surged 28% and oil is up 16% year to date in dollar terms
– Are Argentina, Turkey, South Africa, Indonesia and other emerging markets exceptions? Economists think so but contagion could spread rapidly
– Emerging-market crisis is driving safe-haven demand for German Bunds and soon gold
– Important not to think of gold solely in US dollar terms and realise that gold is again acting as a safe haven for those who need a currency hedge
Source: Goldprice.org
Market Performance YTD in USD (Finviz.com)
News and Commentary
Gold nudges up as dollar eases; Sino-U.S. trade tensions in focus (CNBC.com)
Mighty Dollar and Trade Fears Drag Silver Down to Two-Year Low (Bloomberg.com)
Gold near 1-wk lows as trade, emerging market concerns boost dollar (Reuters.com)
Bullard says Fed should hold off on raising rates (MarketWatch.com)
EU Looking to Sidestep U.S. Sanctions With Payments System Plan (Bloomberg.com)
