Could G7 Ban On Russian Imports Impact Gold Price?

G7 members are planning to ban imports of Russian gold in order to tighten the sanctions squeeze on Moscow. However, the precious metal is expected to ignore these news headlines according to TD Securities’ experts and economists.

Key Quotes
“G-7 ban on new Russian gold imports isn’t expected to impact gold trading considering the London Bullion Market Association’s ban has already cut off new Russian output from major markets within the G-7. In turn, price action is reversing to reflect the minor impact on gold. However, gold prices are also being pulled higher as rising recession risks drive inflows into the precious metal.”

“Gold bugs sniffing out a potential stagflationary outcome associated with lower growth but lingering inflation should also consider that central banks, facing a credibility crisis, could also continue to raise rates for longer than they otherwise would. In this scenario, pricing for a Fed pivot would be less associated with recession odds than in prior episodes.”

“In the near-term, continued whipsaws from CTA trend followers reflect the range-bound price action in the precious metal as macro pressures build.”