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Commodities Fundamental Report: Tuesday 21-03-2017

News Date: 21/3/2017 03:23:04
 

Gold is still near its highest level in two weeks, taking advantage of the weak dollar, after Federal Reserve Bank of Chicago Governor Charles Evans confirmed yesterday the Fed's cautious approach to raise interest rates, and no rush for further interest rates hike.

Evans said the Federal Reserve is likely to wait at least until the monetary policy meeting in June to decide whether to accelerate the interest rates raise again or not?

Spot gold prices fell 0.41% to trade around $ 1228.41 an ounce.

The absence of a concrete policy from the administration of US President Donald Trump is a concern for investors, prompting them to buy gold as a safe haven amid the decline in stock markets.

Evans, in one of the first official comments after the last interest rates hike by Fed , noted that the US Central Bank needed time to digest economic and financial data on the market, as well as any clarity on Trump's fiscal policy plans.

The Federal Reserve is expected to drop interest rates to meet the inflationary pressures expected from Trump's policies, after the central bank dropped any hints of a tightening of monetary policy last week, which in turn supports short- and medium-term gold appreciation.

Futures US crude oil contracts rose as the Organization of the Petroleum Exporting Countries (OPEC) is considering extending its decision to cut oil production levels to control the sharp decline in crude oil prices seen in the markets over the past three years.

Futures US crude oil contracts for May delivery rose 0.2% to trade at $ 49.08 a barrel.

OPEC countries and other non-oil producers, led by Russia, pledged to cut oil output by 1.8 million bpd between January and June as part of efforts to control the oil supply glut.

However, it seems that these efforts have not yet succeeded, US oil shale production is increasing, and oil stockpiles are still high, and this increased negative pressure on crude oil prices.

 
Sponsored by: CloudsIndex.com 

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