Oil and gold prices dip as the US dollar is flexing its muscles on the international stage. The US dollar index (DXY) went from 102 to 103.5 points this week climbing nearly 1.5% in three days. On the other hand, Crude and Brent oil prices dipped nearly 1% as the US dollar strengthened in the markets. The growing US dollar made Brent crude futures fall to $77.93 per barrel, and crude futures (WTI) down to $71.97 a barrel. In addition, gold prices fell from $2,050 to $2,010 and another downturn could send it below the $2,000 mark.
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US Dollar Clamps Down Oil & Gold Prices
Gold prices now risk falling below $2,000 if the US dollar rises in the indices this week. Read here for a realistic price prediction on how high gold can trade in 2024. The USD pulled back despite the Red Sea crisis that could bring the currency down.
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The stronger US dollar has offset the Red Sea disruption risks successfully avoiding a nosedive in the global markets. The US dollar reached a one-month high on Wednesday after the Feds pushed back against interest rate cut expectations.
However, investors are cautious as concerns of the Red Sea tensions escalating in the coming days remain high. The Red Sea attack made the US stock market dip for three consecutive days on Monday, Tuesday, and Wednesday. Nasdaq and the Dow Jones Industrial index are in the red making leading stocks to fall to monthly lows.
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The Red Sea crisis remains a cause for worry as Houthi rebels could disrupt trade in the coming days. On Sunday, a US-owned ship was struck by a missile off the coast of Yemen in the Red Sea. The anti-ship ballistic missile came from Houthi-controlled areas of Yemen, according to the US Central Command.