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Commodities edge higher on softer dollar and renewed hopes of US rate cut

COMEX Gold prices strengthened on Wednesday as the dollar eased after dovish comments from Federal Reserve Chair Jerome Powell. Fed Chair Jerome Powell on Tuesday noted that the U.S. central bank still needs more data before cutting interest rates to ensure that recent weaker inflation readings give a true picture of what is happening to underlying price pressures. WTI Crude Oil steadied near a two-month high on signs of a big drawdown in US crude stockpiles. Brent crude edged up, holding above $86 a barrel, after slipping 0.7% on Tuesday. Meanwhile, escalating geopolitical tensions in the Middle East raised concerns about oil supply, as Israel continued its siege on Gaza, ordering Palestinians to evacuate Khan Younis ahead of a potential attack. OEPC’s oil output rose for a 2nd straight month in June due to increased production in Nigeria and Iran. LME base metals trading positive on hopes of announcement of stimulus measures at China’s Third Plenum policy meeting due in mid-July. LME Copper trading positive for 4th consecutive session on a softer dollar amid renewed hopes of U.S. rate cuts and as supply jitters offset a dismal outlook for physical demand from top consumer China. Benchmark copper on the LME was up 1.34% at $9,800 a metric to while LME Nickel and Zinc trading higher by 1.46% and 1.02% respectively. European natural gas prices nudged lower as brimming stockpiles and steady flows from Norway help keep the market at ease. Benchmark futures fell as much as 1.4% on Wednesday, after a marginal gain the previous day. Prices are hovering below €34 a megawatt-hour, a level many traders see as a ceiling for now as demand for the fuel remains low. (Bloomberg) Investors will now eying data on ADP employment and weekly jobless claims data due later in the day, and the non-farm payrolls report due on Friday.

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