Connect with us
  • tg

Commodities

Gold prices weaken, eye break below $2,300 as rate jitters persist

letizo News

Published

on

Investing.com– Gold prices fell in Asian trade on Thursday and were close to breaking below key levels as waning safe haven demand and the prospect of higher-for-longer U.S. interest rates battered the yellow metal.

Bullion prices were nursing a sharp drop from record highs over the past week, as a potential conflict between Iran and Israel did not escalate as markets were fearing. This largely dented safe haven demand for the yellow metal.

Waning safe haven demand left gold vulnerable to headwinds from U.S. rates, given that higher-for-longer rates push up the opportunity cost of investing in bullion.

fell 0.1% to $2,313.62 an ounce, while expiring in June fell 0.6% to $2,325.05 an ounce by 00:26 ET (04:26 GMT). 

Strength in the – which remained close to recent five-month peaks, also pressured metal prices.

Gold eyes $2,300 support, more rate cues awaited 

Spot prices were now close to breaking below the $2,300 an ounce support level, which could herald more near-term losses for the yellow metal.

But gold’s next leg of movement is expected to be driven largely by more upcoming cues on the U.S. economy and interest rates.

First-quarter U.S. data due later on Thursday is expected to show whether the world’s largest economy remained resilient in the beginning of 2024. 

data- which is the Federal Reserve’s preferred inflation gauge- is likely to have a bigger impact on gold, given that it ties directly into the central bank’s outlook on interest rates.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or
remove ads
.

Hotter-than-expected U.S. inflation readings and hawkish Fed signals saw traders largely price out expectations for a June rate cut- a scenario that presents more near-term pressure for gold prices.

Other precious metals also retreated on Thursday after tumbling from recent peaks over the past week. fell 0.3% to $910.30 an ounce, while fell 1% to $27.078 an ounce.

Copper prices cool further from 2-year highs

Among industrial metals, copper prices fell further from recent two-year highs as weak economic readings and fears of high interest rates somewhat offset optimism over tighter markets. 

on the London Metal Exchange fell 0.2%  to $9,773.0 a ton, while fell 0.1% to $4.4510 a pound. Both contracts were below two-year highs hit earlier in April, after stricter western sanctions on Russian metal exports pointed to tighter markets. 

But this optimism was dulled by top copper producer Chile signaling that state-owned copper miner Coldeco will increase output in 2024.

Concerns over steady demand also weighed after U.S. purchasing managers index data read weaker than expected for April, with the back in contraction territory. 

Commodities

Oil set for weekly gain on signs of improving demand

letizo News

Published

on

By Shariq Khan

NEW YORK (Reuters) – Oil prices rose in Asian trading hours on Friday, with global benchmark Brent set for its first weekly increase in three weeks on signs of improving global demand and slowing inflation in top oil consumer the United States.

prices rose 21 cents, or 0.3%, to $83.48 a barrel by 0018 GMT. U.S. West Texas Intermediate (WTI) crude futures rose 18 cents, or 0.2%, to $79.41 a barrel.

Brent futures are set to rise about 1% on a weekly basis, and WTI futures are set to gain 1.4%.

Recent declines in oil and refined products inventories at major global trading hubs have created optimism over oil demand growth, reversing a trend of rising stockpiles that had weighed heavily on prices in prior weeks. Through Thursday, Brent crude futures were down around 10% from this year’s peak of $92.18 a barrel on April 12.

U.S. oil and fuel inventories fell last week, while Singapore’s middle distillate fuel stocks dropped to a near three-month low this week. In Europe’s Amsterdam-Rotterdam-Antwerp trading hub, gasoline stocks were down 7.5% in the week to Thursday, data from consultancy Insights Global showed.

Recent economic indicators from the United States have fed into the optimism over global demand. U.S. consumer prices rose less than expected in April, data showed on Wednesday, boosting expectations of lower interest rates in the country.

Those expectations were further bolstered by data on Thursday that showed a stabilizing U.S. job market.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or
remove ads
.

Lower interest rates could help soften the U.S. dollar, which would make oil cheaper for investors holding other currencies and drive demand.

“Financial markets now have placed the most bets on a September interest rate cut by the Federal Reserve, which would continue to temper the dollar strength and shift that strength over to commodities and equities,” StoneX oil analyst Alex Hodes said on Thursday.

Continue Reading

Commodities

Goldman Sachs discusses what’s next for natural gas prices

letizo News

Published

on

Over the past three weeks, US prices have surged 30% to above $2.50 per million British thermal units (mm/BTU), fueled by production declines and increased feedgas demand for liquified natural gas (LNG) exports.

Moreover, recent producer cuts, maintenance events, and Freeport LNG’s normalization of gas demand post-outage have contributed to this rise. Cheniere’s announcement of no heavy maintenance for its liquefaction trains this year also supports higher prices.

In a Thursday note, Goldman Sachs strategists said the return of gas prices above $2/mmBtu aligns with their expectations, as production curtailments “would ultimately lead to lower storage congestion risks for this summer.”

“That said, we see only limited further upside from current levels, with stronger gas prices risking a return of congestion concerns,” they added.

Goldman notes that prices above $2/mmBtu reduce gas competitiveness compared to coal, with a $0.50/mmBtu increase potentially cutting gas demand by 1 billion cubic feet per day (Bcf/d), especially in shoulder months.

Moreover, higher prices may prompt the restart of previously shut-in wells. EQT (ST:), the largest producer in the Appalachia region, indicated it would resume production if prices sustainably exceed $1.50/mmBtu. And while Appalachia prices haven’t risen as much as NYMEX, the local hub has averaged $1.44/mmBtu month-to-date, up 10¢ from last month, strategists highlighted.

Elsewhere, European gas prices have also risen this summer, though less sharply than in the US.

Title Transfer Facility (TTF) prices increased 18% over the past three months to around 30 euros per megawatt-hour (MWh), holding steady in May.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or
remove ads
.

However, unlike the US market, this rally lacks fundamental support, with Northwest (NW) European gas storage at record-high levels, Goldman strategists pointed out.

“To be sure, NW European LNG imports have remained weak relative to last year – and are likely to get weaker in the coming weeks owing to a seasonal decline in global LNG production, exacerbated by outages at Australia’s Gorgon export project,” they said.

“Going forward, we expect healthy non-European demand for LNG to continue to incentivize a decline in European LNG imports vs last year,” they continued.

Continue Reading

Commodities

Gold prices trim some weekly gains on tempered rate cut hopes

letizo News

Published

on

Investing.com– Gold prices fell slightly on Friday, trimming some of their gains for the week as comments from a slew of Federal Reserve officials offered a more sobering outlook on interest rate cuts. 

The yellow metal had risen to nearly $2,400 an ounce this week in the immediate aftermath of some soft U.S. economic readings. But it pulled back from these levels on Thursday and Friday.

steadied at $2,377.40 an ounce, while expiring in June fell slightly to $2,381.10 an ounce by 00:19 ET (04:19 GMT). 

Gold retreats as Fed officials downplay rate cuts, but weekly gains due

The yellow metal fell on Thursday after a string of Fed officials cautioned against bets on immediate reductions in interest rates. 

Several members of the central bank’s rate setting committee said the central bank will need much more convincing that inflation was coming down beyond a marginally soft inflation reading for April. 

This saw traders begin pricing out some expectations for a rate cut in September. The and also rebounded from earlier losses this week. 

Still, some softer-than-expected readings put gold on course for a 0.7% weekly gain. 

The yellow metal was also in sight of a record high of above $2,430 an ounce, although it appeared unlikely the level would be met in the near-term. 

Other precious metals retreated on Friday, but were set for bumper weekly gains. fell 0.2% but were trading up 6.2% for the week, while fell 0.4% but were up 4.5% this week. 

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or
remove ads
.

Copper mixed amid middling China cues

Among industrial metals, one-month copper futures tumbled from two-year highs tracking middling economic data. But three-month copper futures pushed higher and were set for a stellar week as markets bet on tighter supplies and an eventual demand recovery in the coming months. 

on the London Metal Exchange rose 0.6% to $10,445.0 a ton, while rose 0.3% to $4.8935 a pound. 

Data from China on Friday painted a mixed picture of the economy. While grew more than expected, growth slowed and shrank at an accelerated pace. Growth in Chinese also slowed.

The readings presented a muddled outlook for the world’s biggest copper importer, as it rolled out more stimulus measures to shore up growth.

Three-month copper futures gained on the prospect of a demand recovery, and were up nearly 4% this week. They were also at two-year highs. 

Continue Reading

Trending

©2021-2024 Letizo All Rights Reserved