CUR - Commodity Roundup: Metals set for cautious start to the week; oil down after Saudi price cuts
2024-01-08 06:11:21 ET
The precious metals complex also moved lower against a stronger dollar, while investors positioned for a key inflation number due later this week. Spot gold ( XAUUSD:CUR ) was down - 0.88% at $2,027.46 by 6 am ET.
For markets, the main event will be Thursday's U.S. CPI, with investors counting on the core rising by 0.2% month-on-month and dragging the annual pace down to 3.8%, a level not seen since mid-2021. Although gold is seen as an inflation hedge, higher interest rates raise the opportunity cost of holding bullion.
Saxo Bank in a recent note stated that, the commodities sector traded close to unchanged during the first week of trading with losses across metals and agriculture being offset by gains in the energy sector.
The focus and drivers behind these moves have been the negative input from the lowering of U.S. rate cut expectations, weak economic data prints from China, geopolitical risks associated with Red Sea, as well as pockets of very cold weather across the Northern Hemisphere lifting demand for gas and power.
Bullion has seen a relatively quiet start to 2024, trading down around 1.5% during a week that included Friday’s strong report, and Saxo Bank says, the ebb and flow of geopolitical risks associated with tensions in the Red Sea area has primarily been providing an underlying bid to gold with silver struggling to keep pace amid China related weakness across industrial metals.
Copper prices meanwhile were steady after sliding in Asian hours. An analyst quoted by Reuters said, the ongoing mine-side supply disruptions would cap losses against thin stocks and expectations of growing demand driven by the new energy sector.
The imported copper ore and concentrate index provided by Shanghai Metals Market fell to $58.63 per ton last Friday, down from around $90 in October. The index falls when the market becomes tighter, Reuters report said.
ING Commodities in an article said, a seasonal lull in demand has pushed iron ore port inventories in China to the highest level since the week ending September 1, 2023. Steel inventories at major Chinese steel mills fell to 12.4mt in late December, down 17.7% compared to mid-December, according to data from the China Iron and Steel Association (CISA).
Elsewhere among agriculture commodities, soybean, cocoa and wheat trade in red.
Recent Commodity Price Movements
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Energy
Metals
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Palladium ( XPDUSD:CUR ) -1.86% to $1,007.86.
- Silver ( XAGUSD:CUR ) -0.92% to $22.95.
- Copper ( HG1:COM ) +0.04% to $3.79.
Agriculture
Commodity ETFs
Gold ETFs:
Other Metal ETFs:
Oil ETFs:
Agriculture ETFs:
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Commodity Roundup: Metals set for cautious start to the week; oil down after Saudi price cuts