The geopolitical turmoil in the Middle East has sent gold and oil prices higher today.
In a region whose wealth is reliant on commodities, it is no wonder that oil and gold prices were the first to react to the assassination of former Pakistani Prime Minister Bhutto. Gold is the purest form of wealth and almost always rises in times of geopolitical uncertainty. With the implications for the US unclear, we expect gold to continue to trickle higher, which should benefit both the Australian and New Zealand dollars. The Canadian dollar on the other hand is higher because oil prices are higher. For a region whose wealth is contingent upon the value of the natural resource, anything that stands to threaten the availability of the resource on the open market will trigger a price increase which eventually filters down to the value of the Canadian dollar.