For the first time in weeks both gold and crude oil are up on the day, surprisingly so is the US dollar index. Gold is trading $32 or 0.73% higher today at $4,506 while crude oil is up by $2.92 or 3.30% at $91.30 and the US dollar index is higher as well up 0.42% at approximately 5:34 PM EST.
It was recently reported that Putin will restrict gold exports from Russia beginning in May the official decree reads, “Effective May 1, Russia will ban the export of gold bars weighing more than 100 grams. According to the Russian Deputy Prime Minister, this measure is part of a broader crackdown on the shadow economy. The Deputy Finance Minister noted that gold is increasingly being used as a substitute for foreign exchange in illicit transactions, thereby fueling capital flight and money-laundering activities. Analysts predict that, with the policy set to take effect on May 1, a wave of gold sales could occur in the run-up to that date. Russia is the world's second-largest gold producer.”
Under a new Russian law that takes effect on May 1, individuals are allowed to take no more than 100 grams of gold out of the country, worth about $15,000.
This could cause an increase of gold being sold by Russians in the upcoming month and possibly add more bearish pressures to the already high number of headwinds facing the precious yellow metal.
For now, gold is still trading on a bounce higher after hitting the 200-day simple moving average on Monday of this week. We will have to see if this new Russian restriction will change that trajectory.
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