Weekly Data for Oil and Gold: Price Review for the Week Ahead

Commodity

Summary:

Oil prices steadied amid Iran-U.S. tensions and weak Chinese data, with bearish technical signals. Gold rose on U.S. credit downgrade but faces resistance as overvaluation concerns limit near-term upside.

USOIL, Daily

Oil prices held steady on Monday as markets awaited the outcome of Iran-U.S. nuclear talks and key Chinese economic data that could impact commodity demand. Brent crude was at $65.36 and WTI at $62.52 per barrel, with the more active July WTI contract slightly lower. Last week, prices rose over 1% after the U.S. and China paused their trade war, while analysts warned that weak Chinese data could dampen market sentiment.

Chinese industrial production data came out at 6.1% down from the previous reading of 7.7% but higher than the anticipated 5.5%. Uncertainty around the Iran deal, particularly U.S. demands on uranium enrichment, also lent some support to prices.

On the technical side, the price found sufficient resistance in an area of the chart combining the 50-day moving average and the 50% of the daily Fibonacci retracement and has since corrected to the downside. The Stochastic oscillator is in the extreme overbought levels, hinting at a potential continuation of the bearish momentum, and also the moving averages are validating the overall bearish trend as well, therefore supporting the selling narrative.

If the crude oil does continue to lose value then the first area of possible technical support might be found around $60 which is the psychological support of the round number and just above the 23.6% of the daily Fibonacci retracement level.

Gold-dollar, Daily

Gold prices rose following Moody’s downgrade of the U.S. credit rating, triggering a risk-off shift in markets. However, growing investor skepticism is emerging, with 45% now viewing gold as overvalued. Despite safe-haven demand, gold may have peaked for now, as positioning is overcrowded and the outlook remains cautiously bullish long-term, but near-term gains may be limited unless geopolitical tensions escalate further. Treasury rhetoric on tariffs added to uncertainty, supporting gold for the time being..

From a technical point of view, the price of gold has rebounded at a major technical support level on the chart, consisting of the lower band of the Bollinger bands, the 50-day moving average, and the 61.8% of the Fibonacci retracement level. Currently, it is testing the resistance of the 50% of the daily Fibonacci retracement level while the Stochastic oscillator is at neutral levels.

The moving averages are confirming the overall bullish trend despite the recent sell-off; therefore, it is possible to see a minor bullish run in the upcoming sessions. If this happens, then the first area of potential resistance might be seen around $3,300, which is the psychological resistance of the round number as well as the 38.2% of the daily Fibonacci retracement level.

Source: fxempire

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Thomas

Economic

Moody's decision to downgrade the U.S. credit rating may have consequences for your money, experts say.

The debt downgrade put immediate pressure on bond prices, sending yields higher on Monday morning. The 30-year U.S. bond yield traded above 5% and the 10-year yield topped 4.5%, hitting key levels at a time when the economy is already showing signs of strain from President Donald Trump's unfolding tariff policy.

Treasury bonds influence rates for a wide range of consumer loans like 30-year fixed mortgages, and to some extent also affect products including auto loans and credit cards.

"It's really hard to avoid the impact on consumers," said Brian Rehling, head of global fixed income strategy at Wells Fargo Investment Institute.

Moody's lowers U.S. credit rating

The major credit rating agency cut the United States' sovereign credit rating on Friday by one notch to Aa1 from Aaa, the highest possible.

In doing so, it cited the increasing burden of the federal government's budget deficit. Republicans' attempts to make President Donald Trump's 2017 tax cuts permanent as part of the reconciliation package threaten to increase the federal debt by trillions of dollars.

'Downgrades can raise borrowing costs over time'

Americans struggling to keep up with sky-high interest charges aren't likely to get much relief any time soon amid Moody's downgrade.

"Economic uncertainty, especially regarding tariff policy, has the Fed — and a lot of businesses — on hold," said Ted Rossman, a senior industry analyst at Bankrate.

Atlanta Fed President Raphael Bostic said on CNBC's "Squawk Box" Monday that he now sees only one rate cut this year as the central bank tries to balance inflationary pressures with worries of a potential recession. Federal Reserve Chair Jerome Powell also recently noted that tariffs may slow growth and boost inflation, making it harder to lower the central bank's benchmark as previously expected.

Douglas Boneparth, another CFP and the president of Bone Fide Wealth in New York, agreed that the downgrade could translate to higher interest rates on consumer loans.

"Downgrades can raise borrowing costs over time," said Boneparth, who is also on CNBC's FA council.

"Think higher rates on mortgages, credit cards, and personal loans, especially if confidence in U.S. credit weakens further," he said.

Which consumer loans could see higher rates

Some loans could see more direct impacts because their rates are tied to bond prices.

Since mortgage rates are largely tied to Treasury yields and the economy, "30-year mortgages are going to be most closely correlated, and longer-term rates are already moving higher," Rehling said.

The average rate for a 30-year, fixed-rate mortgage was 6.92% as of May 16, while the 15-year, fixed-rate is 6.26%, according to Mortgage News Daily.

Although credit cards and auto loan rates more directly track the federal funds rate, the nation's financial challenges also play a key role in the Federal Reserve's stance on interest rates. "The fed funds rate is higher than it would be if the U.S. was in a better fiscal situation," Rehling said.

Since December 2024, the overnight lending rate has been in a range between 4.25%-4.5%. As a result, the average credit card rate is currently 20.12%, down only slightly from a record 20.79% set last summer, according to Ted Rossman, a senior industry analyst at Bankrate.

Credit card rates tend to mirror Fed actions, so "higher for longer" would keep the average credit card rate around 20% through the rest of the year, Rossman said.

'We've been through this before'

Before its downgrade, Moody's was the last of the major credit rating agencies to have the U.S. at the highest possible rating.

Standard & Poor's downgraded the nation's credit rating in August 2011, and Fitch Ratings cut it in August 2023. "We've been through this before," Rehling said.

Still, the move highlights the country's fiscal challenges, Rehling said: "The U.S. still maintains its dominance as the safe haven economy of the world, but it puts some chinks in the armor."

Source: CNBC

To stay updated on all economic events of today, please check out our Economic calendar

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Adam

Forex

Euro CPI and core CPI unchanged in final reading

Eurozone headline inflation was confirmed at 2.2% y/y and 0.6% m/m in April, unchanged from the preliminary estimates. The core rate was also confirmed at 2.7% y/y and 1% m/m. Services inflation rose to 3.9% from 3.5%.

The European Central Bank will be pleased that inflation was unchanged in the final April release but remains concerned about services inflation, which remains persistently high. The ECB trimmed its key rate by a quarter point to 2.25% last month and meets next on June 5. The markets have priced in another rate cut, as the ECB looks to take advantage of stable inflation and lower rates in order to boost economic growth.

ECB and Fed remain cautious due to Trump's tariffs

The ECB can be expected to be cautious with its rate path and continue its data-driven approach. There is much uncertainty surrounding President Trump's tariffs, which has made it difficult for the ECB to make inflation and growth projections. What is clear is that eurozone growth has taken a hit from the tariffs and the outlook and the outlook for global growth has been revised downwards. The damage from the tariffs could be mitigated if the US and China can reach an agreement which removes the tariffs between them.

The uncertainty surrounding US trade policy has also pushed the Federal Reserve into a wait-and-see stance, despite Trump's loud calls for a rate cut. The Fed held rates at this month's meeting and is widely expected to stay on the sidelines again in June. The Fed is waiting for more clarity on the tariff front, but any surprises from inflation or employment data could have a significant impact on rate policy.

EUR/USD Technical

EUR/USD has pushed above resistance at 1.1212. Above, there is resistance at 1.1260

There is resistance at 1.1171 and 1.1123

EUR/USD 1-Day Chart, May 19, 2025

Source: marketpulse

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Warren Takunda

Economic

The Pound to Canadian Dollar exchange rate (GBP/CAD) is forecast to maintain a constructive tone over the coming days, with a rise to 1.8716 being a possibility.

Pound Sterling starts the new week with a spring in its step, pushing GBP/CAD through the interim resistance line at 1.8599, which had capped strength through much of March, April and May.

If the pair can hold the gains into the day's close, then we would be highly confident that 1.8716, the 2025 high, is touched next.

Pound-to-Canadian Dollar Week Ahead Forecast: Bullish on U.S. Fiscal Fears_1

Above: GBP/CAD at daily intervals.

For now, we annotate in our Week Ahead Forecast chart that the resistance here will hold, and allow for a pullback, potentially back to 1.8599, which would have flipped in nature from resistance to support.

The Canadian Dollar is struggling at the start of the new week on account of fresh "sell America" fears following a decision by Moody's to lower its U.S. sovereign debt ratings.

The move indicates the agency has concerns about the sustainability of the U.S. debt pile, which will continue to balloon if President Donald Trump's spending bill is passed by Congress this week. Far from getting debt dynamics under control, Trump will oversee fresh peaks in the country's overall debt burden.

"Following the Moody’s downgrade, US Equity futures and the dollar are starting the week weaker, as markets resume the 'sell America' trade," says Thanim Islam, Head of FX Analysis at Equals Money.

For the Canadian Dollar, "sell America" is clearly unhelpful, and it is under pressure against the Pound, Euro and other alternative currencies.

The 30-year U.S. treasury yield rose back to the psychological 5% level following the Moody's downgrade, and S&P 500 Index futures slid.

Moody’s said on Friday it was stripping the U.S. government of its top credit rating, dropping the country to Aa1 from Aaa.

This week will see the U.S. Congress pass Trump's "Big Beautiful Bill" which wraps together various Trump administration objectives into one substantial piece of spending and tax legislation.

The fall in North American currencies suggests markets are concerned about where things are heading.

"The US has an additional problem: whatever the Republican Congress decides to do with fiscal policy over the next few weeks, it will most likely be "locked in" for the remainder of the decade," says George Saravelos, Head of FX Research at Deutsche Bank.

"The very difficult reconciliation process and the potential loss of a Republican majority in the mid-terms essentially leaves space for only one major fiscal event during the current Trump administration. Once this concludes, there will be very little that can be done to change the fiscal trajectory for the foreseeable future," he explains.

The U.S. is Canada's most important neighbour in terms of trade and financial market integration. Trouble down south spells trouble up north, and explains why CAD might struggle as long as U.S. fiscal concerns persist.

Source: Poundsterlinglive

To stay updated on all economic events of today, please check out our Economic calendar

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Daniel Carter

Political

Russia-Ukraine Conflict

U.S. President Donald Trump spoke to Russia's Vladimir Putin on Monday about peace in Ukraine after Washington said there was an impasse over ending Europe's deadliest conflict since World War Two and that the United States may have to walk away.

President Putin sent thousands of troops into Ukraine in February 2022, triggering the gravest confrontation between Russia and the West since the 1962 Cuban Missile Crisis.

Trump, who says he wants to be remembered as a peacemaker, has repeatedly called for an end to the "bloodbath" of Ukraine, which his administration casts as a proxy war between the United States and Russia.

Under pressure from Trump, delegates from the warring countries met last week in Istanbul for the first time since 2022, after Putin proposed direct talks and Europeans and Ukraine demanded an immediate ceasefire.

A White House official said the call was underway.

Shortly before the call, U.S. Vice President JD Vance told reporters that Washington recognised there was an impasse in ending the war - and that if Moscow was not willing to engage then eventually the United States would have to say it was not its war.

"We realize there's a bit of an impasse here. And I think the president's going to say to President Putin: 'Look, are you serious? Are you real about this?'" Vance said as he prepared to depart from Italy.

"I think honestly that President Putin, he doesn't quite know how to get out of the war," Vance said, adding that he had just spoken to Trump.

He said it "takes two to tango. I know the President's willing to do that, but if Russia is not willing to do that, then we're eventually just going to say, this is not our war."

"We're going to try to end it, but if we can't end it, we're eventually going to say: 'You know what? That was worth a try, but we're not doing anymore.'"

Source: Reuters

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Adam

Commodity

Gold prices are solidly higher in early U.S. trading Monday, as the marketplace is jittery following a surprise ratings agency downgrade to U.S. government debt and lingering global trade worries. Silver prices are moderately up. June gold was last up $60.20 at $3,247.40. July silver prices were last up $0.421 at $32.775.

Risk aversion is elevated to start the trading week. Moody’s ratings agency downgraded the United States’ long-term credit rating from “Aaa” to “Aa1” last Friday, citing sustained increases in federal debt and chronic fiscal deficits. The U.S. now joins Fitch and S&P Global in no longer holding a perfect rating among major credit agencies.

Financial markets were also rattled a bit when U.S. Treasury Secretary Bessent said in an interview Sunday that trade tariffs would go back to April 2 announced levels if countries don’t negotiate with the U.S. “in good faith.” Fresh economic data out of China shows the trade war with the U.S. has dented the Chinese economy.

Asian and European stock markets were mixed to weaker in overnight trading. U.S. stock indexes are pointed to solidly lower openings today in New York.

Gold prices are sharply up on safe-have demand amid the sell off in global stock markets.

The key outside markets today see the U.S. dollar index sharply lower. Nymex crude oil futures prices are lower and trading around $62.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently at 4.546%.

U.S. economic data due for release Monday is light and includes leading economic indicators.

Gold price sharply up on renewed safe-haven demand_1

Technically, June gold futures bulls and bears are on a level overall near-term technical playing field but the bulls are fading. Bulls’ next upside price objective is to produce a close above solid resistance at $3,350.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the May low of $3,123.30. First resistance is seen at $3,275.00 and then at $3,300.00. First support is seen at the overnight low of $3,209.10 and then at $3,200.00. Wyckoff's Market Rating: 5.0.

Gold price sharply up on renewed safe-haven demand_2

July silver futures bulls and bears are on a level overall near-term technical playing field. Silver bulls' next upside price objective is closing prices above solid technical resistance at $33.48. The next downside price objective for the bears is closing prices below solid support at $31.00. First resistance is seen at $33.00 and then at $33.48. Next support is seen at the overnight low of $32.425 and then at $32.00. Wyckoff's Market Rating: 5.0.

Source: kitco

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Damon

Economic

Hey crypto enthusiasts! While your focus might be on Bitcoin charts and altcoin movements, a significant shift just happened in the traditional finance world that could send ripples into the digital asset space. The US 30-year Treasury yield just climbed to a level not seen since November 2023, hitting 5.02%. What does this seemingly distant financial metric have to do with your crypto portfolio? Potentially, a lot. This surge didn’t happen in a vacuum; it closely followed a major announcement from credit rating agency Moody’s.

What is the US 30-Year Treasury Yield and Why Does 5.02% Matter?

Let’s break it down. The US 30-year Treasury yield represents the return an investor receives for holding a U.S. government bond for 30 years. Think of it as the interest rate the U.S. government pays to borrow money over the long term. It’s a crucial benchmark for long-term interest rates across the entire economy, influencing everything from mortgage rates to corporate borrowing costs.

When the yield goes up, it means investors are demanding a higher return to lend money to the government for such a long period. A jump to 5.02%, the highest point since November 2023, signals a significant shift in the bond market. This could be driven by several factors:

Inflation expectations: Investors may anticipate higher inflation in the future, demanding a higher yield to compensate for the loss of purchasing power.
Increased government borrowing: More supply of bonds (due to government spending) can push yields up if demand doesn’t keep pace.
Investor sentiment: A decrease in confidence or a shift towards other investments can reduce demand for Treasuries, raising yields.

The Catalyst: Understanding the Moody’s US Downgrade

Adding fuel to the fire, this yield surge occurred shortly after Moody’s announced on the evening of May 16 that it had downgraded the U.S. government’s credit rating. The rating moved from the top-tier Aaa to Aa1. This Moody’s US downgrade is a big deal because credit ratings are essentially grades given by agencies like Moody’s, S&P, and Fitch, assessing a borrower’s ability to repay debt. A downgrade suggests a slightly increased risk, even for a borrower as historically safe as the U.S. government.

Moody’s cited several reasons for their decision, primarily focusing on:

Fiscal Challenges: Concerns over the U.S.’s growing debt burden and the political challenges in addressing it.
Political Polarization: The difficulty in reaching consensus on fiscal policy, potentially leading to increased volatility or delays in debt ceiling negotiations.

While still a high rating (Aa1 is the second-highest tier), a downgrade from Aaa can rattle investor confidence and potentially increase the perceived risk of holding U.S. debt, contributing to the demand for higher yields.

How Does This Treasury Yield Impact Broader Markets?

The Treasury yield impact extends far beyond just government bonds. As a benchmark, the 30-year yield influences a wide range of long-term interest rates. Higher Treasury yields generally lead to:

Higher borrowing costs: For companies, consumers, and even homeowners (think mortgage rates). This can slow down economic activity.
Reduced appeal of riskier assets: When ‘safe’ investments like U.S. Treasuries offer higher returns, they become more attractive relative to riskier assets like stocks or, yes, cryptocurrencies. This can lead investors to shift capital out of risk assets.
Currency strength: Higher yields can attract foreign investment into U.S. dollar-denominated assets, potentially strengthening the dollar.

Navigating Current Bond Market Trends

The recent move to 5.02% is part of broader bond market trends that have seen yields fluctuate based on economic data, inflation reports, Federal Reserve policy expectations, and now, credit rating assessments. The bond market is often seen as a forward-looking indicator. The current trends suggest that investors are factoring in persistent inflation, potential future rate hikes (or fewer cuts than previously expected), and increased fiscal risk.

These trends indicate a market environment where the cost of capital is rising. This can pose challenges for businesses relying on borrowing and can influence investment decisions across all asset classes.

What Could Be the Crypto Market Reaction?

Now, for the question many of you are asking: What does this mean for crypto? The crypto market reaction to traditional finance shifts isn’t always direct or immediate, but macro factors play a significant role, especially in times of uncertainty.

When safe-haven assets like U.S. Treasuries offer increasingly attractive returns (like 5.02% on a 30-year bond), the relative appeal of volatile, risk-on assets like cryptocurrencies can diminish. Investors who prioritize capital preservation might opt for the higher yield on government bonds rather than the potential high returns (and high risks) of crypto.

Potential impacts on the crypto market could include:

Reduced liquidity: As capital potentially flows towards higher-yielding traditional assets.
Increased selling pressure: Some investors might de-risk portfolios by selling speculative assets.
Heightened volatility: Uncertainty in traditional markets often spills over into crypto.

However, it’s important to remember that the crypto market has its own unique drivers, including technological developments, regulatory news, and adoption rates. While macro headwinds can create pressure, they don’t solely dictate crypto’s trajectory.

Challenges and Insights for Crypto Investors

The current environment presents challenges but also offers opportunities for informed investors.

Challenges:

Increased correlation with traditional markets: Crypto is less of an uncorrelated asset when macro risks dominate.
Potential for drawdowns: Risk assets can face significant pressure when borrowing costs rise and liquidity tightens.

Insights:

Stay informed about macroeconomics: Understanding factors like Treasury yields and credit ratings is crucial.
Assess your risk tolerance: Re-evaluate your portfolio allocation in light of changing market conditions.
Look for long-term value: Focus on projects with strong fundamentals rather than purely speculative plays during uncertain times.
Dollar-Cost Averaging (DCA): This strategy can help mitigate volatility by investing a fixed amount regularly, regardless of market ups and downs.

Conclusion: Navigating a Shifting Landscape

The surge in the US 30-year Treasury yield to 5.02% and the preceding Moody’s US downgrade are significant developments in the traditional financial world. They highlight ongoing fiscal challenges and political risks facing the U.S. economy. These factors contribute to rising borrowing costs and can influence global investment flows.

While the direct Treasury yield impact on daily crypto prices can be hard to isolate, these macro bond market trends create a backdrop of tighter financial conditions. The potential crypto market reaction is one of increased sensitivity to risk-off sentiment and potentially reduced liquidity compared to periods of ultra-low interest rates.

For crypto investors, staying aware of these broader economic shifts is vital. It’s a reminder that the crypto market doesn’t exist in a vacuum and is increasingly influenced by global macroeconomic forces. As markets continue to digest these developments, vigilance and a well-thought-out strategy remain your best tools.