Oil Prices Surge on Geopolitical Tensions

Crude oil prices rose sharply following drone attacks on energy infrastructure in Saudi Arabia and Russia, stoking fears of wider supply disruptions. Escalating tensions in the Middle East, including a US directive for diplomats to leave Saudi Arabia, further supported the rally in oil prices, which in turn strengthened commodity-linked currencies like the Canadian Dollar.

Precious Metals Fall on Inflation Concerns

Gold and silver prices declined as the surge in crude oil fueled fears of accelerating inflation. This development has increased market expectations for a more aggressive monetary policy response from the Federal Reserve, putting downward pressure on non-yielding assets like precious metals.

US Dollar Steadies as Markets Await Fed Cues

The US Dollar Index showed little movement as the impact of rising bets on a Fed rate hike was counteracted by falling US bond yields. Currency markets remained in a holding pattern, with traders looking ahead to upcoming US economic data and central bank meetings for clearer direction on monetary policy, while currencies like the Euro and British Pound held steady against the greenback.