Editor’s Note
This market update highlights a recent downturn in global commodities, driven by a resurgent US dollar. As investors await key US economic data, the shift in sentiment underscores the complex interplay between currency movements and risk appetite.
As of mid-February 2026, global commodity markets have collectively weakened against the backdrop of a US dollar rebound. Gold prices fell significantly during the US stock market session, losing the key $4,900 level. OEXN indicates that this phase of decline is primarily influenced by the strengthening US Dollar Index (DXY) and a shift in macro risk-aversion logic. With market expectations heating up for a series of key US economic data to be released this week, short-term funds, lacking new positive catalysts, opted to cash out at high levels, causing gold to break away from its previous strong consolidation range.
When analyzing the underlying logic of recent price volatility, relevant researchers believe that the contraction of geopolitical risk premium is a significant trigger for the gold price correction. Despite ongoing aircraft carrier deployments and military exercises in the Middle East, the previously tense geopolitical premium rapidly dissipated as US-Iran negotiations in Geneva reached a consensus on “guiding principles.” This shift in sentiment has caused gold’s appeal as a safe-haven asset to temporarily give way to strengthening US dollar assets in the short term.
Beyond the dilution of geopolitical factors, the market is holding its breath for the upcoming policy signals from the Federal Reserve (Fed). Related analysis suggests that the Fed’s January meeting minutes and the PCE price index to be released on Friday will directly reveal the pace of interest rate cuts in the first half of 2026. Furthermore, the market’s perception of the new Fed Chair nominee as non-dovish has intensified anxiety in the metals market due to this shift in perceived policy preference. Relevant data shows that, in addition to precious metals, industrial metals like copper futures have also seen high-net-worth clients exiting positions, reflecting a defensive positioning across the industry against future liquidity tightening risks.
Despite short-term selling pressure, OEXN believes that from a macro-cycle perspective, gold’s fundamental logic remains robust. As global central banks, especially in emerging markets, accumulated gold purchases in 2025 already accounted for over one-third of global demand, and expanded federal fiscal spending in 2026 will continue to dilute fiat currency credibility, the value-preserving attributes of physical assets remain irreplaceable. The current correction in gold prices is more inclined to be a technical overbought correction. After the PCE data and preliminary GDP figures clarify the economic outlook, prices in the $4,800 to $4,900 range may become a key reference point for bulls to rebuild defensive positions.
