Quote on Gold and Crude by Kaynat Chainwala, AVP-Commodity Research, Kotak Securities
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Below the Quote on Gold and Crude by Kaynat Chainwala, AVP-Commodity Research, Kotak Securities
COMEX Gold prices reversed previous day’s gains and closed lower on Monday after data showed that China’s central bank didn’t buy any gold for a second month in June. Bullion held by the PBoC was unchanged at 72.8 million troy ounces at the end of last month, ending an 18 month buying spree. Weak US jobs data and services activity last week prompted investors to price in two rate cuts this year. Markets now see around a 76% chance of a Fed rate cut in September, with a second rate reduction in December also being priced in. Investors now look ahead to key US inflation data this week, as well as fresh commentary from Fed officials to gain more insights on the monetary policy path.
WTI Crude oil futures extended declines for the second consecutive day, as the tropical storm Beryl, which first made landfall in Texas as a Category 1 hurricane, has been downgraded due to decreased wind speeds and now seems set to dissipate without impacting US domestic crude oil production. However, the hurricane shut US refineries and ports along the Gulf of Mexico, and hopes a possible ceasefire deal in Gaza reduced. WTI crude steadied near $82/bbl as Hurricane Beryl did not have a significant impact on major refineries along the US Gulf Coast and as oil market participants awaited the release of the Energy Information Administration’s Short-Term Energy Outlook.
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