IGI Logo

Below the Quote on Gold and Crude by Kaynat Chainwala, AVP-Commodity Research, Kotak Securities

COMEX June gold futures fell over 2% on Monday, closing at $2,973.60 per ounce, marking a third consecutive session of losses and the lowest close in three weeks. The decline was driven by a stronger US dollar and as investors liquidated gold positions to cover margin calls and lock in profits amid broader market volatility. The uncertainty deepened after President Trump threatened to impose a 50% tariff on China unless it removed its 34% retaliatory duty on US goods. Risk-off sentiment has been rising since last week, driven by sweeping US tariffs, which have heightened fears of a global recession. Today, gold rebounded by 1.5%, trading above $3,020 per ounce as escalating trade war risks and geopolitical tensions, including Trump’s warning to Iran over a potential nuclear deal, revived demand for safe-haven assets. Investors are now awaiting key US data and the FOMC meeting minutes for clues on future policy direction, though Fed Chair Powell has already signaled a cautious approach to rate cuts due to the elevated risk of inflation and slower growth from the Trump tariffs.

WTI crude oil extended its losses for the third consecutive session on Monday, falling below $59 per barrel for the first time in four years, as growing recession risks weighed on the oil demand outlook. The decline was further exacerbated by the escalating trade standoff between the US and China. US President Donald Trump threatened to impose an additional 50% import tax on China in response to Beijing’s new 34% retaliatory tariffs. Meanwhile, Saudi Arabia’s decision to reduce its official selling price (OSP) for Asian markets, ahead of an OPEC production increase in May, added further selling pressure. Today, crude oil prices rebounded to $61.75 per barrel as traders monitored developments on the trade front, with China warning of countermeasures if Trump proceeds with his new tariff threats.

Above views are of the author and not of the website kindly read disclaimer