Flat In Asia

Gold continues to outperform its fundamental drivers, residing within touching distance of the $2,000/oz mark (last little changed at $1,975/oz), even with U.S. real yields running higher in recent weeks (our weighted U.S. real yield monitor sits at the highest level observed since mid-’20), which has been accompanied by the DXY moving to ~2 year highs. Geopolitical tensions, namely the Russia-Ukraine conflict have clearly facilitated this outperformance, while ETF flows have also provided a flow driven component to the rally in the yellow metal, with total known ETF holdings of gold moving back up to Q121 levels. Asia-Pac trade has been limited, as expected, given the widespread holidays observed across most of the global financial centres.