Oil and bitcoin up, Gold slips amid higher yields

Oil higher as EU nears Russian ban

Oil prices are heading higher again, up more than 2%, as reports suggest the EU is nearing a framework for phasing out Russian oil imports. Given how big a market it is for Russia, accounting for roughly half its exports, that will come as a real blow to the Kremlin. Except for the fact that the devil will be in the detail and I suspect it won’t be the hammer blow that it appears at first sight.

Germany has suggested it will half its Russian oil imports by the summer and end them by the end of the year. While replacing such a massive partner won’t be easy, that does buy it time to explore alternative markets, albeit probably at a steep discount. Oil is also only one major source of revenue for Russia; there’s still little talk of gas embargos which would really hurt the Kremlin.

Still, oil prices are creeping higher again but remain pretty much in the middle of the range they’ve traded within for the last month.

Gold slips as yields continue higher

Yields are creeping higher again amid a raft of hawkish commentary from a variety of central banks that appears to be paving the way for increasingly aggressive action in the month ahead. This appears to be weighing on gold which has slipped back below $1,950 after a strong rally earlier this month.

Perhaps the rally was driven by higher inflation expectations and the hawkish commentary is addressing those concerns. It’s a fine balancing act when so many are questioning whether the Fed can manufacture the soft landing it desires. Time will tell whether this optimism will pay off.

Can bitcoin build on recent momentum?

Bitcoin is enjoying a fourth day of gains just after it survived a break of a potentially key support level. The resilience shown to the move below $40,000 was impressive and potentially indicative of the remaining bullishness in the space, despite the uncertainty elsewhere. The Nasdaq has had a more turbulent week which bitcoin has managed to shrug off; maybe a sign of it distancing itself from the link between the performance of the two. Whether it can sustain that we’ll see as there’s one thing both still have in common, they’re viewed as risky assets, albeit with bitcoin very much at the higher end of the scale.

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