Quote On Gold and Crude by Kaynat Chainwala, Senior Manager - Commodity Research, Kotak Securities
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Below the Quote On Gold and Crude by Kaynat Chainwala, Senior Manager - Commodity Research, Kotak Securities
COMEX gold (December) closed 0.5% higher at $2492.4/oz yesterday after briefly dropping below $2470/oz, as mixed US data with easing CPI and stronger retail sales did not provide any fresh insight on Fed’s monetary policy path. Also, decline in industrial production and rising business inventories signal potential weakness in the manufacturing sector and slowing demand. Earlier in the session, gold prices fell as robust retail sales and lower unemployment claims, suggested a less dovish Fed stance. This led investors to lower their expectations from an aggressive 50 bps rate cut in September to a more modest 25 bps. Today, COMEX Gold edged lower and trades below $2500/oz but is still headed for a modest weekly gain as markets digest US data releases and cautiously await US building permits, housing starts and UoM consumer sentiment.
WTI crude oil prices surged 1.5% yesterday, closing above $78/bbl and reversing two days of losses. This rebound was fueled by better-than-expected US retail sales and jobless claims data, which eased recession concerns. Oil prices slipped to $76.83/bbl on Wednesday due to expectations that Iran might refrain from attacking Israel, coupled with an unexpected 1.4 million-barrel increase in US oil inventories. Today, WTI Crude steadied near $78/bbl as geopolitical tensions in the Middle East and easing US recession fears counter weak Chinese demand outlook. Markets are closely monitoring the Israel-Iran situation, with reports that US President Biden has dispatched three top Middle East advisers to the region this week to help delay potential Iranian and Hezbollah military retaliation against Israel.
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