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Russia to be cut-off from SWIFT

“If you can learn to create a state of mind that is not affected by the market’s behaviour, the struggle will cease to exist.” – Mark Douglas

 

 

HEADLINES

 

 

  • Investors brace for volatility as West moves to cut Russia off from SWIFT
  • Dollar retreats as risk appetite returns; U.S. inflation dials back Fed view
  • Speculators cut net long US dollar bets in latest week
  • Gold, palladium slip as Ukraine conflict triggers sharp swings
  • Oil could jump back above $100 as traders assess Russia SWIFT ban, analysts say
  • Stocks set for a painful week as conflict intensifies; bonds to gain
  • Russia-Ukraine Crisis: Three macroeconomic scenarios – ABN Amro
  • CRUDE OIL Near Term: Downside favored

 

 

FOREX

 

 

Investors brace for volatility as West moves to cut Russia off from SWIFT

Investors were preparing on Saturday for more wild gyrations in asset prices after Western nations announced a harsh set of sanctions to punish Russia for its invasion of Ukraine, including blocking some banks from the SWIFT international payments system.

New measures announced by the United States, Britain, Europe and Canada also include restrictions on the Russian central bank's international reserves. The moves will be implemented in the coming days.

 

 

 

Dollar retreats as risk appetite returns; U.S. inflation dials back Fed view

 

 

The U.S. dollar dipped on Friday, giving back some of the strong gains from the previous day, as investors gauged the latest round of sanctions on Russia and U.S. inflation data was seen as unlikely to make the Federal Reserve overly aggressive at its next policy meeting.

The greenback on Thursday notched its biggest one-day percentage gain since Nov. 10 to reach 97.74, its highest since June 30, 2020. However, it gave back some gains.

 

 

 

Speculators cut net long US dollar bets in latest week

 

 

Speculators cut their net long U.S. dollar positions in the latest week, according to calculations by Reuters and U.S. Commodity Futures Trading Commission data released on Friday. The value of the net long dollar was $5.80 billion in the week ended Feb. 22, compared with a net long of $6.76 billion the previous week.

COMMODITIES

 

 

Gold, palladium slip as Ukraine conflict triggers sharp swings

 

 

 

Gold prices reversed course to slide 1% on Friday, and palladium also slipped, as Russia's invasion of Ukraine triggered sharp swings in the precious metals market.

Spot gold slipped 0.9% to $1,887.05 per ounce by 02:02 p.m. ET (1902 GMT), swinging between gains and losses through the session. U.S. gold futures settled 2% lower at $1,887.60.

 

 

 

Oil could jump back above $100 as traders assess Russia SWIFT ban, analysts say

 

 

 

A decision by Western allies on Saturday to block certain Russian banks from the SWIFT payments system is likely to lift oil prices well above $100 a barrel as risks with trading Russian oil spike, analysts say. Russian exports of all commodities from oil and metals to grains will be severely disrupted by the new Western sanctions, traders and analysts said.

 

 

 

STOCKS

 

 

Stocks set for a painful week as conflict intensifies; bonds to gain

 

 

 

World markets were set for another tumultuous week after Western nations announced a harsh set of sanctions to punish Russia for its invasion of Ukraine and as fighting intensified for a fourth day.

U.S. stocks have fallen nearly 8% so far this year, on track for the worst annual start since 2009, and worries over the intensifying conflict in Ukraine has shaken markets across the world.

Though Wall Street ended higher on Friday with major indices up between 1.5%-2.5%, analysts expected markets to come under selling pressure on Monday.

 

 

 

ANALYSIS

 

 

 

Russia-Ukraine Crisis: Three macroeconomic scenarios – ABN Amro

 

 

The price shock scenario (probability: 75%)

“Commodity prices continue their surge higher, and prices remain elevated for the foreseeable future until we see some moves to de-escalate the conflict.

 

The supply shock scenario (probability: 20%)

“In addition to the price shock, physical supplies of gas are disrupted, perhaps as a counter-response tThe severe supply shock scenario (probability: <5%)

“Western governments impose a ban on Russia’s use of the SWIFT payments system, causing major disruptions to all Russian commodity exports (i.e. not just gas, but also oil, metals and food).o western sanctions. This depends naturally on just how severe western sanctions become.

 

 

 

CHART

 

 

CRUDE OIL Near Term: Downside favored

 

 

 

Technical View: Short position below 96.5. Target 89. Conversely, break above 95.5, to open 98.35.

Comments: The pair remains under pressure. Further weakness favored.

Source: Trading Central
 

 

 

CALENDAR

 

 

 

 

 

 *Times in GMT

Source: FX Street Economic Calendar


Footnotes
1.    https://www.fxstreet.com/economic-calendar
2.    https://www.fxstreet.com/news/russia-ukraine-crisis-three-macroeconomic-scenarios-abn-amro-202202251340
3.    https://www.reuters.com/markets/europe/euro-tries-recover-after-tumbling-russian-invasion-ukraine-2022-02-25/
4.    https://www.reuters.com/markets/stocks/speculators-cut-net-long-us-dollar-bets-latest-week-2022-02-25/
5.    https://www.reuters.com/markets/europe/gold-rises-with-russia-ukraine-situation-focus-2022-02-25/
6.    https://www.reuters.com/markets/asia/oil-could-jump-back-above-100-traders-assess-russia-swift-ban-analysts-say-2022-02-27/
7.    https://www.reuters.com/markets/europe/global-markets-wrapup-1-pix-2022-02-27/
 

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