17 Apr 2023 | News & Feature

No glitter amidst the gold rush

  • Despite the increase in oil prices, price movements in the commodity market remain consistent with a recession outlook. China’s limited growth potential further highlights the bearish signal in the commodity market.
  • The recent surge in gold prices may signal a delayed return of positive real rates, which could be due to stubborn inflation or looming recession risks that could prompt the Fed to cut its policy rate.
  • Slowing aggregate demand growth and an overvalued Rupiah may allow BI to start cutting rates, although such a scenario remains unlikely given the Fed’s “no-cut” outlook in 2023.