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Monday News Highlights - Russia-Ukraine Tensions, Gold spot $ 1,853/ounce


Happy Valentine's Day to all our viewers. We hope the season of love has brought you happiness and joy. Our article today provides some insights to the perspective of members of Federal Reserve banks and the tensions between Russia-Ukraine.

Federal Reserve

  • San Francisco Fed Bank President Mary Daly states that she is not yet prepared for a half-percentage-point interest rate hike next month.
  • She believes that the Fed must reduce some of its accommodation from the economy. However, the Fed should also remain cautious on the action it decides to take as history has indicated that abrupt and aggressive actions lead to a destabilising effect on growth and price stability, the very core goal they are trying to achieve.
  • Daly's remarks came after a hectic week as to the Fed's actions next month when the central bank is expected to raise interest rates. 
  • Thursday's (CPI) consumer report indicates a more than an unexpected inflation rate. St Louis Fed President James Bullard has called for a minimum of one percentage point in rate hikes by the end of June. 
  • Daly remains unsettled in an immediate move to raise the rates despite the Fed's inflation goal running well above its flexible target of 2%. She believes that the Fed should raise rates in its March meeting and should be monitoring each step of the way. 


  • Gold has consolidated to its highest in the last four months to $1,858/ounce. Gold prices rose as investors sought safety from the Russia-Ukraine and United States fiasco. 
  • Despite Moscow's statement denying plans of an invasion and accusing the West of creating hysteria, Russia has deployed more than 100,000 troops near the Ukraine border. 
  • The markets are preparing themselves for turbulent times, which could see investors shying away from the US dollar to safe-haven assets such as gold. However, without such conflict occurring, gold would fall short of the higher interest rates and hawkish regime of the Federal Reserve.

Russia-Ukraine Updates

  • US President Joe Biden and Ukraine President Volodymyr Zelenskyy have been tirelessly pursuing diplomacy to ease tensions. The US national security adviser has stated that Moscow is searching for a pretext for the attack. 
  • However, President Biden has made his position clear that the United States will respond swiftly and decisively with its allies and partners to prevent further Russian aggression against Ukraine.
  • Russia's President Putin has indicated to Biden in a call on Saturday that Washington has failed to consider Russia's primary concerns and has yet to receive "substantial answers" on critical elements of its security demands.
  • Putin seeks guarantees from the United States and NATO forces:

a) Blocking Ukraine's entry into NATO

b) Refrain missile deployments near Russia's borders

c) Scaling NATO military infrastructures in Europe to their 1997 levels. 



FX Street



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