The Surging Dollar Kills Commodities

by Craig Hemke
Sprott Money

March has been a very challenging month for precious metal investors. However, it has been a difficult month for commodities across the board. Why? The surging Dollar Index is the primary culprit.

And it’s not just March. The full first quarter of 2021 has begun poorly for COMEX gold and silver. As March draws to a close, COMEX gold is already down over 10% year-to-date with COMEX silver down nearly the same, despite an incredible surge of retail investment demand that wiped clean the shelves of nearly every major bullion dealer on the planet.

Why the tough start to the year? Let’s start by checking the two key inputs used by the HFT trading machines in deciding whether or not to buy or sell COMEX futures. And what are these two inputs? The yield on the U.S. 10-year note and the price of the U.S. Dollar Index.

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