NZD/USD rose to about 0.5910 in early Asian trading on Tuesday, as the New Zealand Dollar strengthened after inflation data. Focus later on Tuesday turns to the US March Retail Sales report.

Statistics New Zealand said CPI increased 3.1% year on year in Q1 2026, matching the 3.1% rise in Q4 2025 and above the 2.9% forecast. Quarterly CPI rose 0.9% in Q1 from 0.6%, above the 0.8% estimate.

New Zealand Inflation Lifts Kiwi

The US Dollar could find support from rising US–Iran tensions, which can lift demand for safe-haven currencies. A two-week ceasefire is due to end on Wednesday.

US President Donald Trump said on Monday he is not likely to extend the ceasefire with Iran. Iran’s top negotiator said Tehran will not negotiate under threats and accused Trump of seeking a “table of surrender”.

The New Zealand dollar is seeing some strength after inflation came in hotter than expected. This Q1 CPI reading of 3.1% YoY means the Reserve Bank of New Zealand will likely feel pressure to keep interest rates high for longer. We see this as delaying any potential rate cuts that the market might have been anticipating for later this year.

However, a major risk is the escalating tension between the US and Iran, with a ceasefire set to expire this week. A failure to extend it could trigger a flight to safety, benefiting the US dollar. We remember how the VIX index, a key measure of market fear, surged over 45% in the week after the conflict in Ukraine began back in 2022, showing how quickly markets can pivot to risk-off sentiment.

US Retail Sales In Focus

All eyes are now on the US Retail Sales report for March, which is due out later today. A strong number would reinforce the idea of a robust US economy, giving the Federal Reserve less reason to cut rates and further strengthening the dollar. For example, back in March 2024, retail sales beat expectations and rose 0.7%, which provided a significant lift to the Greenback at the time.

Given these powerful but opposing forces, we believe volatility in the NZD/USD is the main takeaway for the coming weeks. One-week implied volatility for the pair is already climbing towards 12% as traders anticipate a significant price swing. This environment suggests that long volatility strategies, such as buying straddles or strangles, could be effective to profit from a large move in either direction.

For those with existing positions, using options to hedge against a sharp reversal is a prudent move. Purchasing put options can protect a long NZD position from a sudden drop caused by geopolitical news or strong US data. Alternatively, a trader convinced of one outcome could use options to make a defined-risk bet, such as buying a call option if they believe the RBNZ’s stance will ultimately outweigh the geopolitical risks.

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Gold (XAU/USD) was little changed near $4,825 in early Asian trading on Tuesday, as markets assessed fresh geopolitical risk in the Middle East. Prices held steady as uncertainty continued around regional security and diplomacy.

Reuters reported on Monday that Iran is considering attending peace talks with the United States in Pakistan, after Islamabad moved to end a US blockade of Iran’s ports. Officials said no decision had been made, while Iranian Foreign Minister Abbas Araghchi cited “continued violations of the ceasefire” by the US as an obstacle to further talks.

Geopolitical Risk And Energy Market Impact

Oil prices have risen on concerns about a breakdown in US-Iran talks and the possibility of a renewed blockade of the Strait of Hormuz. Higher energy costs can add to inflation expectations and reduce the likelihood of interest-rate cuts, which can limit demand for non-interest-bearing assets such as gold.

Later on Tuesday, the focus is the US Retail Sales report. Retail Sales are forecast to rise 1.4% month-on-month in March, up from 0.6% in February; weaker-than-expected inflation could pressure the US dollar and support dollar-priced gold.

With gold trading near $4,825, the market is caught between Middle Eastern geopolitical support and the pressure of high interest rates. This deadlock suggests that outright directional bets are risky in the immediate term. We see traders becoming cautious, waiting for a clear catalyst to break the current range.

The primary upside risk is a complete breakdown in the US-Iran peace talks, which could escalate tensions in the Strait of Hormuz. We saw during similar episodes in 2019 that even the threat of disruption to oil supplies can cause a flight to safety, benefiting gold. A renewed blockade would almost certainly push gold toward new highs, making long call options an attractive hedge.

Rates Inflation And Volatility Strategies

However, the dominant headwind for gold remains stubborn inflation and the corresponding central bank policy. With the last US Consumer Price Index (CPI) report showing inflation running at 3.1%, well above the Fed’s target, the market has priced out most expected rate cuts for this year. This high interest rate environment increases the opportunity cost of holding a non-yielding asset like gold.

This week’s US Retail Sales data will be a crucial test of this dynamic. A figure coming in stronger than the expected 1.4% would reinforce the idea of a robust US economy, likely strengthening the dollar and pushing gold lower. Conversely, a weak number could revive rate cut hopes and provide a lift for the precious metal.

Given these conflicting signals, we believe traders should consider strategies that capitalize on volatility rather than direction alone. Buying long-dated straddles or strangles could prove effective, as they would profit from a large price move in either direction. This approach allows one to position for a breakout without betting on whether it will be caused by a missile or a weak economic report.

We also have to look at how implied volatility behaved during the 2025 debt ceiling negotiations, where it spiked significantly before collapsing once a deal was reached. The current situation feels similar, suggesting that selling options premium through strategies like iron condors could be profitable if peace talks succeed and gold’s price action calms down. This would be a bet that the current uncertainty is overpriced by the options market.

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GBP/USD rose 0.1% on Monday to about 1.3530, after easing from last week’s high near 1.3600. It has been moving between 1.3500 and 1.3600, after rebounding from early April lows near 1.3160.

Geopolitics is driving markets as a two-week US-Iran ceasefire is due to end on Wednesday night, with an extension called “highly unlikely”. West Texas Intermediate futures jumped more than 6% to $89 a barrel after the US seized an Iranian cargo ship in the Gulf of Oman.

Key Events And Market Drivers

Upcoming events include the UK labour market report, US Retail Sales, and Kevin Warsh’s Senate hearing as Fed chair-designate. The UK CPI and flash PMI data in the UK and US also feature, with UK Retail Sales and University of Michigan sentiment due on Friday.

GBP/USD was at 1.3534 on a 15-minute chart, with the day’s open at 1.3485 and Stochastic RSI at 18.85. On the daily chart it traded at 1.3535, with the 50-day EMA at 1.3421, the 200-day EMA at 1.3358, and Stochastic RSI at 93.74.

The pound dates to 886 AD and is the world’s fourth most traded currency, making up 12% of FX, or $630 billion a day (2022). GBP/USD accounts for 11% of FX, GBP/JPY 3%, and EUR/GBP 2%, with policy set by the Bank of England.

We see GBP/USD consolidating near 1.3530, but the rally from the early April lows looks tired. The daily chart shows a very overbought stochastic reading, suggesting that upside momentum is stretched. This hesitation means initiating new long positions is risky until we get a clear catalyst.

The main focus is the impending expiration of the US-Iran ceasefire, which is creating major uncertainty. We saw a similar situation during the geopolitical tensions of early 2022, when Brent crude oil prices surged over 30% in just two weeks. With West Texas Intermediate already jumping to $89 a barrel, a failure to extend the ceasefire could trigger a significant risk-off move, likely strengthening the dollar and pushing GBP/USD lower.

Options Strategies And Risk Management

Given this binary risk, we should look at options to trade the potential for a large price swing. Buying a strangle, which involves purchasing both an out-of-the-money call and put option, could be an effective strategy. This position would profit from a sharp move in either direction following the ceasefire news, without betting on the specific outcome.

On top of the geopolitical risk, we have a heavy week of economic data, including key inflation and growth reports from both the UK and the US. Historically, the UK’s Consumer Price Index (CPI) release can cause intraday swings of 50 to 80 pips in GBP/USD within the first hour. This week’s print will be critical for Bank of England policy expectations and will add another layer of volatility.

For those of us already holding long positions, it is prudent to protect our gains from a potential downturn. We can buy protective put options with a strike price near the 50-day moving average around 1.3420. This acts as an insurance policy, limiting our downside if geopolitical tensions escalate or if the UK economic data disappoints.

Conversely, if the ceasefire is extended, we could see a relief rally that breaks the 1.3600 resistance level. To position for this, we could use bull call spreads to bet on a move higher with a defined risk. This approach allows us to capitalize on the market’s current optimistic view while capping our potential loss if that view proves wrong.

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New Zealand’s CPI rose 3.1% year on year in Q1 2026, matching the 3.1% rise in Q4 2025. The market forecast was 2.9%.

Quarterly CPI inflation increased to 0.9% in Q1 from 0.6% previously. The market forecast was 0.8%.

New Zealand CPI Surprise And Market Reaction

At the time of reporting, NZD/USD was up 0.44% on the day at 0.5908. This followed the CPI release.

The New Zealand dollar is influenced by domestic economic conditions and Reserve Bank of New Zealand policy settings. China’s economic performance can affect the currency because China is New Zealand’s largest trading partner.

Dairy prices can also move the currency because dairy is New Zealand’s main export. Higher dairy prices can raise export income.

The Reserve Bank of New Zealand targets inflation between 1% and 3% over the medium term, with a focus near 2%. Interest rate changes can affect bond yields and the NZD, while rate differences versus the US can influence NZD/USD.

Key Drivers For The New Zealand Dollar

New Zealand data such as growth, unemployment, and confidence can shift NZD valuation. Broader market risk sentiment can also affect demand for the currency.

The latest Q1 inflation numbers came in at 3.1%, surprising us by being higher than the 2.9% forecast. This figure remains stubbornly above the Reserve Bank of New Zealand’s target range of 1% to 3%. For traders, this means the prospect of the RBNZ cutting interest rates in the near future has significantly diminished.

We should now expect the RBNZ to hold the Official Cash Rate (OCR) steady at its current level for longer than previously thought. Looking back, we saw the bank hold the OCR at 5.50% for all of 2025, trying to tame inflation that peaked much higher a few years ago. This new data suggests that restrictive policy must continue.

This changes the calculus for options traders, as the implied volatility on the NZD will likely see a short-term spike. We should consider buying NZD call options to bet on further strength, as the interest rate differential with countries like the US is now less likely to narrow. Selling out-of-the-money puts could also be a viable strategy to collect premium, assuming a floor has been established for the Kiwi.

We also have to watch external factors, especially data from China, New Zealand’s largest trading partner. Recent figures showed China’s Q1 GDP grew by a solid 5.2% and its manufacturing PMI has stayed in expansionary territory above 50 for two straight months. This positive economic momentum from China provides an additional layer of support for the New Zealand dollar.

Furthermore, the outlook for New Zealand’s key export, dairy, has been improving. The Global Dairy Trade Price Index has seen a cumulative increase of over 8% in the last three auctions, pointing to robust global demand. This trend in dairy prices strengthens New Zealand’s terms of trade and provides a fundamental tailwind for the currency.

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New Zealand’s Consumer Price Index rose 3.1% year on year in the first quarter. This was above the forecast of 2.9%.

The result shows inflation ran 0.2 percentage points higher than expected. The figures compare the first quarter with the same period a year earlier.

Implications For Monetary Policy Expectations

With the latest Consumer Price Index data showing inflation at 3.1%, we see that price pressure is more persistent than anticipated. This result challenges the narrative that the Reserve Bank of New Zealand (RBNZ) would be cutting rates soon. For the next few weeks, the market will re-price the path of the Official Cash Rate (OCR).

Given this, we should consider positioning for a stronger New Zealand dollar, as interest rate differentials will likely move in its favor. Options strategies, such as buying NZD call options against the Australian dollar, could be favorable, especially since Australia’s latest monthly inflation indicator showed a more pronounced cooling to 3.4% earlier this year. The divergence in inflation paths between the two economies is becoming clearer.

For interest rate traders, the focus shifts to derivatives tied to the OCR. We can expect the market to price out any significant chance of a rate cut before the fourth quarter of 2026. Data from the swaps market now suggests pricing for the OCR to remain at its current level of 5.50% through the RBNZ’s May and July meetings has firmed up significantly.

We remember how in late 2025, markets were certain that a global pivot to easing monetary policy was underway. That view was supported when New Zealand’s GDP showed a slight 0.1% contraction in the final quarter of 2025. This hotter inflation print, however, forces the RBNZ to prioritize its price stability mandate over growth concerns for now.

Equity Market Positioning Considerations

This environment could create headwinds for New Zealand equities. Higher interest rates for longer can dampen corporate earnings and economic activity. We should therefore consider protective put options on the NZX 50 index or reduce long exposure via futures contracts.

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AUD/USD fell about 0.2% on Monday to near 0.7180, after opening with a downside gap close to 0.7115. It later recovered most losses but stayed below Friday’s high near 0.7220, with small candles pointing to weaker upward drive.

Focus remains on the US-Iran ceasefire, due to expire on Wednesday night, with President Trump calling an extension “highly unlikely”. The US seized an Iranian cargo ship in the Gulf of Oman, and Iran’s Revolutionary Guard threatened retaliation and reaffirmed plans to close the Strait of Hormuz unless a US naval blockade is lifted.

Ceasefire Risks Remain Underpriced

Iran’s Foreign Ministry said on Monday it had no confirmed plans to attend a second round of talks in Islamabad, though discussions are said to be planned this week. Even so, markets are still priced for a calmer outcome.

West Texas Intermediate futures rose more than 6% to $89 a barrel overnight. US equity futures steadied into the European session, and risk-linked currencies, including the Australian Dollar, found buying on dips.

The week’s key data are limited, with an IMF Meeting and New Zealand Q1 figures on Monday, US Retail Sales on Tuesday, and flash PMIs on Thursday. On charts, AUD/USD was 0.7178, with support near 0.7138 and longer-term levels at the 50-period EMA (0.7009) and 200-period EMA (0.6779), while Stochastic RSI readings included 98.19.

The market seems to be ignoring the major risk this week, which is the US-Iran ceasefire expiring on Wednesday. Despite WTI oil prices jumping to $89 a barrel, risk assets like the Aussie dollar are finding support. This suggests a dangerous level of complacency among traders.

Options Strategies For Elevated Event Risk

We must remember that over 20% of the world’s daily oil supply passes through the Strait of Hormuz, a chokepoint Iran has threatened to close. A failure of talks could easily see oil spike well above $100, a scenario the current AUD/USD price near 0.7180 does not reflect. Looking back at the oil market volatility of 2025, we know how quickly these situations can escalate.

Given this disconnect, buying AUD/USD put options seems like a prudent strategy for the coming weeks. This offers a low-cost way to profit from a potential sharp decline if the ceasefire fails and geopolitical risk is suddenly priced back in. The defined risk of an option premium is appealing when facing such an uncertain binary event.

Implied volatility appears cheap, with measures similar to the CBOE Volatility Index (VIX) hovering near a low of 14, indicating little fear. This presents an opportunity to buy volatility through structures like straddles on the Aussie dollar. Such a position would profit from a large price move in either direction, which is likely following Wednesday’s deadline.

Even if a diplomatic solution is found, the technical picture suggests caution is warranted. The daily Stochastic RSI is extremely overbought at 98.19, signaling that the recent rally is exhausted. This makes it difficult to justify holding long positions, as the potential for further gains appears limited without a significant pullback first.

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New Zealand’s NZIER business confidence fell by 52 percentage points quarter-on-quarter. It recorded -4% in Q1, compared with 48% in the previous quarter.

This sharp reversal in business confidence, from a strong 48% to a negative 4%, is a significant warning sign for the New Zealand economy. Such a dramatic drop signals that businesses are now bracing for a slowdown, directly contradicting the optimism we saw at the end of 2025. We should prepare for increased market volatility as this new reality is priced in.

New Zealand Dollar Outlook

Given this outlook, we should anticipate sustained weakness in the New Zealand dollar. The most direct response is to consider short positions against the kiwi, particularly through options to limit risk. This view is strengthened by recent data showing Australia’s terms of trade improved by 2% in the last quarter, creating a clear policy and economic divergence that favors the AUD/NZD cross.

The Reserve Bank of New Zealand will now be in a difficult position, as this data makes further rate hikes almost impossible. We believe derivatives tied to the Official Cash Rate are now mispriced, and traders should look at positions that will profit if the central bank pivots to a more neutral or dovish stance sooner than expected. The market was pricing a 40% chance of a hike by August; that should now move towards zero.

For equity markets, this is a clear signal to hedge long positions or initiate bearish strategies on the NZX 50 index. When business confidence falls this steeply, future corporate earnings and investment plans are put at risk. Buying put options on the index or on major cyclical stocks offers a way to capitalize on a potential downturn.

Looking back, we saw a similar, though less severe, confidence dip in mid-2025 before the RBNZ paused its hiking cycle. That event led to a 150-pip drop in the NZD/USD over the following two weeks. The current drop is far more pronounced, suggesting the market reaction could be quicker and more severe.

This report also follows last week’s data showing that New Zealand’s net migration figures, a key driver of growth in 2025, have slowed considerably in early 2026. The combination of falling confidence and slowing population growth creates a powerful headwind for the domestic economy. Therefore, positions that bet on a stronger New Zealand economy now carry significantly more risk.

Risk Positioning Considerations

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Commerzbank analyst Dr Henry Hao says China is better placed than many Asian economies to handle energy disruption linked to Middle East tensions and risks around the Strait of Hormuz. The note points to diversified crude imports, large strategic reserves, and lower fossil fuel use per unit of GDP.

Across Asia, countries are using strategic petroleum reserves with mixed results. Japan, South Korea, and Taiwan have strong state stockpiles, while India, Thailand, and the Philippines have limited inventories and are more exposed to extended supply disruption.

China Policy Buffer

China is described as using reserves and policy measures to soften short-term price and supply shocks. Ongoing geopolitical volatility is said to keep pressure on this near-term cushioning.

China has reduced reliance on Middle East crude through diversification, and this share is described as the lowest among major Asian economies. The report says the Middle East portion of China’s crude sourcing has been declining since 2022.

The report adds that China’s broader energy mix is shifting, with more renewables and less fossil fuel consumption per unit of GDP. It also notes that impacts can vary by sector, with transport and chemicals more likely to face strain if volatility persists.

Given the tensions around the Strait of Hormuz, we should consider trades that favor Chinese assets over those of its more vulnerable Asian neighbors. One strategy is to structure a pairs trade, going long the Chinese Yuan against a basket shorting the Japanese Yen and South Korean Won. This position is supported by the latest March 2026 data showing Japan still imports 88% of its crude via the strait, while China’s Q1 2026 figures show its Middle East dependency has fallen to just 42%.

Direct Oil Hedge

An outright long position on Brent crude oil futures or call options is also a direct hedge against a supply shock emanating from the strait. We saw how quickly prices reacted to regional flare-ups back in 2024 and 2025, and any disruption to the nearly 21 million barrels passing through Hormuz daily would have an immediate global impact. This remains the most straightforward way to position for escalating conflict in the region.

China’s structural resilience provides a buffer that its neighbors lack, making its markets a relative safe haven. Last week, China’s National Food and Strategic Reserves Administration confirmed reserves now exceed 90 days of net imports, providing significant short-term insulation from price shocks. This, combined with a reported 25% year-on-year increase in renewable energy generation through February 2026, strengthens the case for China’s relative economic stability.

However, we must also recognize the uneven impact within China’s economy. The analysis points to weakness in the transport and chemical sectors, which are highly sensitive to energy input costs. We can express this view by shorting ETFs focused on Chinese industrial chemicals or by buying put options on major airline and shipping companies listed in Shanghai or Hong Kong.

Finally, the certainty of increased market turbulence means we should be buying volatility. Implied volatility on options for the FTSE China A50 and Hang Seng indices is still relatively low compared to the potential risk. Establishing long vega positions through straddles or strangles would allow us to profit from the price swings that would inevitably follow any disruption, regardless of the ultimate direction.

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USD/JPY moved sideways on Monday after dropping on Friday from near 159.50 to an intraday low close to 157.60. It edged down by under 0.1% and traded around 158.80, staying in a 150-pip range between 158.50 and 159.20.

On Sunday, the US seized an Iranian-flagged cargo ship, the Touska, in the Gulf of Oman. The two-week ceasefire announced on 8 April is due to expire on Wednesday, and President Trump said it will end that evening.

Geopolitical Risk Versus Price Action

Iran denied that a second round of Islamabad talks has been firmly scheduled. Iran re-closed the Strait of Hormuz on 18 April, while WTI crude rose above $89 per barrel.

Key US data this week are Retail Sales on Tuesday and flash PMI figures on Thursday. Japan releases national CPI on Friday, alongside the University of Michigan consumer sentiment survey.

On the 15-minute chart, USD/JPY was 158.83 and below the day’s open at 159.18, with the Stochastic RSI near 67. Resistance is near 159.18.

On the daily chart, it held above the 50-day EMA at 158.15 and the 200-day EMA at 154.60, with Stochastic RSI at 21.19. The story’s technical section used an AI tool.

Options Positioning

Given the market’s indecision around the 158.80 level, we see a clear mismatch between the calm currency price and the escalating geopolitical tension with Iran. The ceasefire deadline on Wednesday is a major binary event that the market seems to be underpricing. This complacency suggests that options, particularly those that protect against a sudden downturn, are attractively valued.

We should be positioning for a potential risk-off shock where the Japanese Yen regains its safe-haven status. Buying USD/JPY put options with expirations in the next few weeks offers a defined-risk way to profit from a breakdown in US-Iran talks. Such a strategy allows us to capitalize on a sharp move lower without being exposed to unlimited risk if the situation de-escalates and the pair resumes its uptrend.

A failure of the ceasefire could easily push WTI crude prices back toward the $100 mark, considering that roughly 21% of global petroleum liquids consumption passes through the Strait of Hormuz. We saw in early 2022 how the invasion of Ukraine sent oil prices soaring over 30% in just a couple of weeks, creating massive market volatility. While USD/JPY rose then due to interest rate policy, a direct conflict in the Gulf could trigger a far more aggressive flight to safety into the yen.

The key indicator to watch is implied volatility, which remains subdued despite the clear and present danger. We expect measures of currency volatility to spike significantly if Wednesday’s deadline passes without a peaceful resolution. Therefore, entering these protective positions now, before volatility gets expensive, is the prudent move.

From a technical standpoint, the 50-day moving average around 158.15 is the critical line of defense for the current uptrend. A break below this level on negative headlines would signal that the bullish structure is failing and could accelerate a move towards the 154.60 area. Our put options would gain significant value in such a scenario.

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Financial markets focused on Middle East tensions, including the closure of the Strait of Hormuz and the US seizure of an Iran-flagged vessel. Traders awaited a second round of Iran–US talks, while Wall Street closed lower and the US Dollar ended with moderate losses.

The US Dollar Index (DXY) touched a five-day high of 98.35 before turning, set to finish near 98.00. With little data due, markets tracked US President Donald Trump’s social media posts, a US delegation trip to Pakistan, upcoming Retail Sales, the ADP Employment Change 4-week average, and the Senate hearing for Fed Chair nominee Kevin Warsh.

Currency Markets And Key Catalysts

EUR/USD initially gapped lower but moved up to around 1.1800, up 0.20% on the day. Attention turned to speeches by ECB officials and the EU and German ZEW Survey of Economic Sentiment for April.

GBP/USD moved back above 1.3500, supported by broad US Dollar weakness, and UK jobs data awaited ILO unemployment for February (three-month period), expected to hold at 5.2%.

USD/JPY rose as the yen was the weakest G10 currency; the Bank of Japan indicated unchanged rates despite markets pricing 47 basis points of tightening, with trade and export/import data due.

AUD/USD closed above 0.7150 on expectations of RBA rate rises, while WTI gained over 2.4% to $85.89 and gold held above $4,800 under pressure from higher Treasury yields.

Looking Back And Positioning Ahead

We remember how the US-Iran flare-up in 2025 sent oil prices soaring. Last year’s closure of the Strait of Hormuz pushed WTI crude past $85, creating extreme volatility in energy derivatives. Today, with OPEC+ holding production steady after its latest meeting and global inventories sitting 5% below the five-year average, options markets are implying much lower volatility.

The US Dollar was whippy in 2025, with the DXY swinging around the 98.00 level based on geopolitical headlines. Now, the index is trading in a tight range near 104.50 after the Federal Reserve signaled a pause in its hiking cycle last month. With the latest CPI data showing core inflation easing to 3.1%, derivative traders should consider strategies that profit from a sideways-moving dollar.

A year ago, we saw EUR/USD climb towards 1.1800 despite a cautious European Central Bank, mostly due to broad dollar weakness. That situation has now shifted, as the ECB remains hesitant to cut rates while the Bank of England is still battling persistent wage growth that remains above 5%. This policy divergence makes long EUR/GBP futures an attractive hedge against further weakness in the pound.

The yen’s weakness was a defining trend in 2025, as the Bank of Japan firmly resisted the global trend of raising interest rates. However, the BoJ’s recent decision in March to finally exit its negative interest rate policy has fundamentally altered the landscape. Traders should look at buying JPY call options against the dollar to position for a potential unwinding of the massive carry trade.

We saw gold struggle for direction back in 2025, as the market was more focused on pricing in aggressive Fed rate hikes which pushed up Treasury yields. Today, the environment for the non-yielding metal has improved significantly, with the 10-year Treasury yield having fallen below 3.8%. Buying long-dated call options on gold could provide upside exposure as central banks globally continue to add to their reserves.

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