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Commodities

Gold prices slump as dollar surges on Trump election victory

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Investing.com–Gold prices fell sharply Wednesday, pressured by a spike in the dollar after victory for Donald Trump in the 2024 presidential election. 

At 08:05 ET (13:05 GMT), fell 2.2% to $2,684.69 an ounce, while expiring in December fell 2% to $2,694.30 an ounce. 

Dollar surges as Trump wins election

Gold prices were pressured by a stronger , with the greenback climbing to a near four-month high after Trump was elected as the 47th president of the United States, returning to the White House for a second four-year term. 

The Republicans have also taken a majority in the Senate, the upper chamber of the US Congress, and were on track to win the House of Representatives, raising the possibility of a Republican sweep in the 2024 elections.

This would present an easier path for Trump to enact major policy changes, many of which are seen as inflationary. Such a scenario is expected to keep interest rates relatively higher in the long-term, helping the greenback.

A stronger U.S. dollar makes greenback-denominated commodities, such as gold, more expensive for holders of other currencies.

Other precious metals were broadly negative on Wednesday, with down 2.2% to $984.35 an ounce, while fell 3.1% to $31.773 an ounce.

Falling real interest rates could spur gold gains – Bernstein 

Still, despite Wednesday’s losses, the yellow metal remained close to recent record highs.

And gold could potentially reach $3,400 per ounce if U.S. real interest rates drop to zero, said analysts at Bernstein, in a note, driven by fiscal policies that could weaken the U.S. dollar.

“Gold has an established negative relationship with [the] U.S. dollar and real rates,” Bernstein notes, as gold typically gains value when fiat currency, such as the dollar, loses strength.

The path to $3,400 per ounce would likely involve a “red sweep or a blue sweep,” which Bernstein views as increasing U.S. fiscal deficits and debt, putting downward pressure on real rates.

Copper slides as Trump’s win spurs China jitters 

Among industrial metals, copper prices fell sharply as Trump’s presented the likelihood of more economic pressure on China, the world’s biggest copper importer.

Benchmark on the London Metal Exchange fell 3.8% to $9,364.50 a ton, while December fell 4.6% to $4.2710 a pound.

Trump has vowed to impose steep trade tariffs on China, heralding more economic pressure on the country as it grapples with persistent deflation and a prolonged property market downturn. 

There is a meeting of China’s National People’s Congress this week, and traders are looking for more cues on Beijing’s plans for fiscal stimulus.

Additionally, the US Federal Reserve concludes its latest policy-setting meeting on Thursday, and the central bank is widely expected to . 

(Ambar Warrick contributed to this article.)

Commodities

Gold prices rise, set for strong weekly gains on Russia-Ukraine jitters

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Commodities

Oil heads for weekly gains as Ukraine war intensifies

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By Robert Harvey and Enes Tunagur

(Reuters) – Oil prices held steady on Friday, on track for a weekly rise of 5%, as the Ukraine war intensified and Chinese imports were set to increase in November.

futures climbed 33 cents, or 0.44%, to $74.56 a barrel by 1008 GMT. U.S. West Texas Intermediate crude futures rose 27 cents, or 0.39%, to $70.37 per barrel.

Both contracts are set for gains of 5% this week, the strongest weekly rise since late September, as Moscow steps up its Ukraine offensive after Britain and the United States allowed Kyiv to strike Russia with their weapons.

Putin said on Thursday Russia had fired a ballistic missile at Ukraine and warned of a global conflict, raising the risk of oil supply disruption by one of the world’s largest producers.

Ukraine has used drones to target Russian oil infrastructure, for instance in June, when it used long-range attack drones to strike four Russian refineries.

“What the market fears is accidental destruction in any part of oil, gas and refining that not only causes long-term damage but accelerates a war spiral,” said PVM analyst John Evans.

The world’s top crude importer, China, announced policy measures on Thursday to boost trade, including support for energy product imports, amid worries over U.S. President-elect Donald Trump’s threats to impose tariffs.

China’s imports are set to rebound in November after sharp price cuts boosted demand for Iraqi and Saudi oil, offsetting a drop in Iranian supply, according to analysts, traders and ship tracking data.

© Reuters. The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County, Texas, U.S., November 22, 2019. REUTERS/Angus Mordant/File Photo

Oil prices briefly dipped after data showed euro zone business activity took a surprisingly sharp turn for the worse this month as the bloc’s dominant services industry contracted and manufacturing sank deeper into recession.

Goldman Sachs said in a note that it expects Brent to stay in a $70 to $85 range, but added that prices could reach the top end of that if Iranian output is impacted by Trump’s possible tightening of sanctions.

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Commodities

Oil prices rise as Russia-Ukraine tensions offset US inventory build

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Investing.com– Oil prices rose in Asian trade on Thursday, buoyed by fears of supply disruptions stemming from worsening tensions in the Russia-Ukraine war, although a build in U.S. inventories limited overall gains.

Prices advanced this week as the use of long-range U.S. weapons by Ukraine against Russia ramped up tensions between the two countries, sparking concerns that oil supplies from Moscow could be disrupted.

Oil also benefited from some bargain buying after dropping to more than one-month lows last week. Still, overall gains were limited by concerns over slowing demand, especially as U.S. inventories grew more than expected.

expiring in January rose 0.4% to $73.07 a barrel, while rose 0.4% to $68.79 a barrel by 22:04 ET (03:04 GMT).

Russia-Ukraine tensions underpin oil

Rising tensions between Russia and Ukraine were a key point of support for oil markets, especially after the U.S. authorized Kyiv to use long-range missiles against Russia. 

Moscow responded to this by lowering its threshold for nuclear retaliation, and warned of a dire escalation in the war.

Ukraine on Wednesday fired a fresh volley of Western-made missiles into Russia, potentially drawing more severe retaliation from Moscow. A key point of anxiety for oil markets is Ukraine’s continued targeting of Russia’s energy infrastructure, which could potentially disrupt oil supplies.

US inventories grow more than expected, gasoline stockpiles rise 

Data from the U.S. Energy Information Administration showed on Wednesday that U.S. grew 0.5 million barrels in the week to November 15, more than expectations for a build of 0.4 mb.

The build, while minimal, was a third straight week of builds.

More worrying for oil markets was a nearly 2.1 mb build in , which spurred some concerns that U.S. fuel demand was cooling as the winter season approached.

Oil prices remained skittish on the prospect of increased supply and softening demand in the coming year, which some analysts expect to cause a supply glut. 

Reuters reported that the Organization of Petroleum Exporting Countries and allies (OPEC+) was planning to further postpone increases in oil production when it meets on December 1.

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