Quote on Gold and Crude quote by Kaynat Chainwala, AVP-Commodity Research, Kotak Securities
Below the Quote on Gold and Crude quote by Kaynat Chainwala, AVP-Commodity Research, Kotak Securities
Comex gold futures rebounded to $3,270.4 per ounce on Tuesday, recovering from a sharp selloff in the previous session. The rebound was driven by a weaker U.S. dollar after softer-than-expected inflation data for April boosted expectations of at least two interest rate cuts by the Federal Reserve this year. Markets are now pricing in 52 basis points of Fed easing by December 2025, aligning with the Fed’s projections from December and March. Data showed headline annual CPI easing to 2.3% from 2.4%, the lowest since 2021, while core inflation held steady at 2.8%. On a monthly basis, CPI rose just 0.2%, below the expected 0.3%, suggesting limited immediate impact from new tariffs. Geopolitical tensions in the Middle East continue to support safe-haven demand for gold. An Israeli airstrike targeting a Hamas leader in Gaza heightened regional instability. Meanwhile, although US-China relations have temporarily stabilized, lingering uncertainty continues to underpin gold's appeal. Gold is currently trading around $3,230 per ounce, supported by further signs of easing US-China trade tensions after the US announced plans to lower the "de minimis" tariff threshold for low-value Chinese shipments to as low as 30%. Investors are now awaiting US Producer Price Index (PPI) and retail sales data for further clues on inflationary trends and consumer spending.
WTI crude oil surged to a two-week high of $63.90 per barrel, fueled by renewed optimism over a US-China trade agreement and escalating concerns about Iranian oil supply. During a visit to Saudi Arabia, President Trump reiterated the U.S.’s commitment to applying maximum pressure on Iran’s energy exports unless a deal is reached over its nuclear program. The U.S. Treasury's Office of Foreign Assets Control also imposed sanctions on nearly two dozen entities involved in Iran’s international oil trade, reinforcing the administration’s hardline stance. Despite a slight pullback today to $63.2 per barrel, oil prices may remain cushioned as markets are closely monitoring progress in US-Iran nuclear negotiations, which could significantly impact global supply. Traders are also awaiting monthly reports from OPEC and the International Energy Agency (IEA) for insights into the global supply-demand outlook.
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