Could Have Enough Downside Momentum to Challenge $1309.00 then $1306.60 – Gold markets went sideways initially during the trading session on Tuesday, but as Federal Reserve Chairman Jerome Powell suggested that the central bank was willing to continue interest rate hikes, the US dollar picked up a bit of steam. Gold markets fell significantly after, is coming from Federal Reserve Chairman Jerome Powell, suggesting that the interest rate hikes would continue, and that, of course, moves the value of the US dollar higher. However, this should not be much of a surprise, so I think it’s only a matter of time before the buyers come in and pick up value.
Copper fell on Tuesday as the dollar edged higher after Federal Reserve Chair Jerome Powell’s debut testimony before Congress – Copper fell on Tuesday as the dollar edged higher after Federal Reserve Chair Jerome Powell’s debut testimony before Congress, weighing on assets priced in the U.S. currency. Markets expect the Fed to hike interest rates three times this year, and Powell’s remarks seemed to indicate the central bank remains on a tightening path. He also said the economy remains strong. This is Powell’s first speech to Congress since taking over as chairman in early February. He succeeded Janet Yellen, who served one full term but was not reappointed by President Donald Trump. London Metal Exchange copper was down 0.9 percent at $7,049 a tonne. The cost to roll aluminum for a day hit its highest since late 2016 on Monday at $11 and remains highly elevated at $10 a tonne. On-warrant aluminum stocks, or those not earmarked for delivery, in London Metal Exchange warehouses, fell by 23,425 tonnes to 1,085,175 tonnes, exchange data showed, pulling back from a recent 11-month high.
Oil prices Down in Asia Morning, Under Pressure From U.S. Production – Oil prices were down Wednesday morning in Asia due to growing U.S. production and a strengthening dollar.Expectations for a weekly build-up in U.S. crude inventories and continued increase in U.S. oil production have brought oil prices down. Crude stockpiles rose by 933,000 barrels last week to 421.2 million barrels. U.S production has surpassed 10 million barrels per day (bpd), an increase of more than 20% since mid-2016. International Energy Agency Executive Director Fatih Birol said on Tuesday that the U.S. will overtake Russia as the world’s largest oil producer by 2019. In an effort to stabilize oil markets, OPEC has been curbing output by around 1.2 million bpd since January 2017, and the deal will run until the end of 2018. While the effort has helped somewhat to support oil prices, the U.S. has continued to increase its oil production, filling the gap in supply created by OPEC and thus pushing prices down. In effect, the surging production in the U.S. is hampering OPEC attempts to ease the global oversupply.
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