Gold price rallied sharply as investors rushed to have assets. Bank stocks, already reeling from two large bank failures in the past week, were under pressure due to the Credit Suisse crisis. Shares of the Swiss lender dropped more than 20% after the chairman of its biggest backer — the Saudi National Bank — said it won’t provide further financial support. Gold price hit a high of $1,937.

The US Dollar weas also bid on safe-haven flows and despite producer prices in the US unexpectedly falling in February. This comes following strong consumer prices earlier in the week. However, fresh woes at Credit Suisse saw safe haven buying continue to pick up. This was aided by the sharp drop in yields on US Treasuries.

The two-year Treasury notes, which move in step with interest rate expectations, have tumbled 98 basis points in the last five days, the biggest drop since the week of Black Monday on Oct. 19, 1987. On Wednesday, they dropped further from 4.413% to pay as low as 3.72%. Benefitting Gold price, the yield curve, as a result, narrowed its inversion further, with the gap between two-year and 10-year yields contracting to -28.60 bps and the tightest spread since October.

Looking to the Federal Reserve next week, markets are now pricing in an 80% chance of a 25 basis point hike and are pricing in a 50% chance of no change. Moreover, the December Fed funds futures, which reflect the overnight rate that banks use to lend to each other has dropped to 3.62% in a sign that the market expects the Federal Reserve to be cutting interest rates by year's end, if not before.