Precious metals hike amid inflation worries
Highlights:
- ENERGY:
Brent crude slipped by 0.6% or 50 cents, to $84.11 a barrel. Meanwhile, WTI crude futures shrank by 0.6% or 49 cents, to $82.01 a barrel. - METALS:
Gold futures for December delivery were trading with an increase of 0.72% or $12.90 to $1,794.80. Meanwhile, silver futures for December delivery advanced by 1.12% or $0.27 to $24.44.
Copper futures for December delivery on the Comex lost 3.39% to $10,063 per tonne. - AGRICULTURAL:
The price of soybeans slipped by around $8 a ton to $450 in Chicago.
Crude oil has fallen sharply
Oil prices are on their way for their first weekly deep in 7 weeks. Easing coal and gas prices caused a drop in demand for oil products.
Brent crude slipped by 0.6% or 50 cents, to $84.11 a barrel. Meanwhile, WTI crude futures shrank by 0.6% or 49 cents, to $82.01 a barrel.
Crude oil has experienced some correction due to sell-off across commodities. It has resulted from concerns about the resurgence of the covid-19 cases and expectations of a milder winter in the US.
The country expects winter weather to be warmer than average.
Earlier in the week, coal and gas shortages globally were the cause of the oil market hitting multi-year highs.
Analysts recommend paying attention to the US dollar since if it keeps falling, it is likely to boost oil prices. Also, they suggest waiting because we will surely see new buying opportunities and raises.
Natural gas slumped from its record highs
Natural gas prices hit a 13-year high earlier this month. Since then, commodity prices have slumped as much as 19%. Analysts believe that it was a result of a warm start of autumn. Natural gas storage has expanded faster than expected and narrowed its deficit shortly.
At the same time, the Energy crisis in the US is not as severe as in Europe. Analysts believe that gas prices will decline next year gradually. So, consumers could be in for a challenging couple of months.
Gold and silver prices rallied
Gold and silver prices settled with advances on Thursday. Gold futures for December delivery was trading with an increase of 0.72% or $12.90 to $1,794.80. Meanwhile, silver futures for December delivery advanced by 1.12% or $0.27 to $24.44.
Peter Boockvar, chief investment officer at Bleakley Advisory Group, believes that the yellow metal has the potential to double its value after the Fed begins tapering. In the scenario of high inflation, gold could reach $2,500 or even $3,000 and above. Meanwhile, silver can regain its highs of $50.
Supply shortages ease, and copper drops again
Copper futures for December delivery on the Comex lost 3.39% to $10,063 per tonne. The market has not reacted to the news about the largest publicly traded copper miner producing less copper than expected. The reason behind it is those market participants have observed an easing supply squeeze. Their attention now is refocused on the danger of slowing demand in China, the main consumer of the metal.
Soybeans prices fell after five consecutive days of increases
The price of soybeans slipped by around $8 a ton to $450 in Chicago. Traders cite profit-taking after hitting nearly two-week highs.
FYO highlighted that soybean futures were pressured by technical resistance and beneficial rain forecasts.
Corn also finished with a loss, although concerns about input cost next year could impact the area planted in the US. Declines were also limited by strong weekly sales reported by USDA. The department announced sales of 130,000 tt. of corn to Mexico for delivery during the 2021/22 marketing season.
