• Home
  • Contact Us
  • Privacy & Policy
Wednesday, May 25, 2022
Finances Advise
No Result
View All Result
  • Home
  • Business
  • Commodities
  • Crypto News
    • Block chain
    • Bitcoin
    • Ethereum
    • Litecoin
  • Finance
    • Financial Advisors
    • Personal Finance
    • Market Insider
  • Forex
  • Investing
  • Stocks
  • ICOs
  • Trading
  • Home
  • Business
  • Commodities
  • Crypto News
    • Block chain
    • Bitcoin
    • Ethereum
    • Litecoin
  • Finance
    • Financial Advisors
    • Personal Finance
    • Market Insider
  • Forex
  • Investing
  • Stocks
  • ICOs
  • Trading
No Result
View All Result
Finances Advise
No Result
View All Result
Home Commodities

Dollar headwinds pressure gold, crude

by admin
March 30, 2021
in Commodities
0
152
SHARES
1.9k
VIEWS
Share on FacebookShare on Twitter


Both crude oil and bullion are facing the dollar headwinds currently. The Euro-USD exchange rate has improved in favour of the latter to 1.179. Given the overall performance of the US economy, the dollar is widely expected to gain strength in the second quarter.

This will have implication for the global commodity markets covering energy and metals.

In particular, the gold market has been kept under check by a firm US dollar and high bond yields. Monday morning, the prices have remained largely unchanged from the $1,730 an ounce level. Firm dollar, and possibly a further rise in bond yields, will not only cap the upside, but can also potentially allow for correction below $1,700 in the weeks ahead.

Waning haven status

Interestingly, gold is not attracting the attention of financial investors, suggesting that its haven appeal may have somewhat waned for now. Speculative investment position continues to stay at relatively low levels on the bourses.

If anything, there is outflow of material from the ETFs. Last week saw 28 tonnes moving out. The labour market improvement in the US is also keenly tracked by punters. If the upcoming labour report shows positive job creation, it could weigh on the price of the yellow metal.

Silver, too, is facing the dollar headwind. Silver ETF holding are down by over 300 tonnes. On the bourses, net long positions are substantially down as per US regulator CFTC’s last report. Price has fallen below $25/oz and the technical picture is said to be weak for the time-being.

Other factors such as improving physical demand in major markets like India and some central bank buying have already been priced-in. Rapid vaccination and improved economic performance in major economies is weighing on market sentiment. So, dollar movement will be for the time-being the single dominant factor to watch out for in the precious metals market.

Crude on a slope

As for crude oil, after the uncertainty of the Suez Canal blockage has passed, the market is beginning to slip again. Brent was trading lower at $63.5 a barrel Monday morning. Of course, it may take 3-4 days for the congestion on the Suez Canal to ease; but further disruption is ruled out.

Clearly, the sentiment in the oil market is undergoing changes. Institutional investors have slashed their net long positions in Brent on the ICE. The number of short sales has risen, according to reports. With gradual weakening of uncertainties, fundamentals are likely to begin to assert.

On Thursday, OPEC and its allies (OPEC+) are meeting again. A host of factors will come up for discussion including output hike, rising demand and rise in non-OPEC oil production. The general consensus is that output cuts will continue to remain in place.

Brent has the potential to decline towards $60 a barrel and even a little below in the weeks ahead. It may bring some relief to importing countries.

The Indian government’s suggestion to Saudi Arabia that the cartel should allow the market forces to operate (meaning, don’t cut output) was turned down. As the world’s third largest consumer, India will have to continue to import oil at high rates to fuel its growth as dependence on imported oil is as high as 80 per cent.

The author is a policy commentator and commodities market specialist. Views are personal

Tags: BrentChinaCOVID-19Crudecrude oildollarETFsgoldheadwindsIndiainvestorsoutflowpandemicPressure
  • Trending
  • Comments
  • Latest

A 48-year market vet warns that the Fed will be forced to tighten policy ‘way sooner’ than investors anticipate as inflation continues to soar — triggering a stock market crash of up to 80%

August 28, 2021
27-year-old UG graduate now millionaire proposes to girlfriend on b’day in video

27-year-old UG graduate now millionaire proposes to girlfriend on b’day in video

August 9, 2021

‘It’s begging to be destroyed’: A stock trader who says he made more than $100,000 shorting the market during the 2008 crash just bet against the S&P 500 — and warns there’s a ‘fair chance’ stocks are about to drop 25%

September 11, 2021

Stocks tanked in the first quarter, and new research shows there should be a reversal by the end of June

April 15, 2022

First Mover Asia: Bitcoin Dominates but Altcoins Lurk

0

Uber Hacking: Customers Not at Risk of Financial Crime, Says Minister

0

Black Friday Merchants Look to Extend Moment of Retail Optimism

0

Hotshot Snapchat Founders Face a Dilemma: Lie Low or Live Large?

0

First Mover Asia: Bitcoin Dominates but Altcoins Lurk

May 24, 2022

Investors May Expect Downside For Bitcoin And Ethereum Market For The Next 3 Months

May 24, 2022

Stellantis CEO warns of electric vehicle battery scarcity, followed by lack of raw materials

May 24, 2022
AUD/USD Forex Technical Analysis – Strengthens Over .7099, Weakens Under .7047

AUD/USD Forex Technical Analysis – Strengthens Over .7099, Weakens Under .7047

May 24, 2022

Recent News

First Mover Asia: Bitcoin Dominates but Altcoins Lurk

May 24, 2022

Investors May Expect Downside For Bitcoin And Ethereum Market For The Next 3 Months

May 24, 2022

Categories

  • Bitcoin
  • Block chain
  • Business
  • Commodities
  • Ethereum
  • Financial Advisors
  • Forex
  • Investing
  • Litecoin
  • Market Insider
  • Personal Finance
  • Stocks

Site Navigation

  • Home
  • Contact Us
  • Privacy & Policy

We bring the Best and latest Crypto News

© 2022 JNews - Premium WordPress news & magazine theme by Jegtheme.

No Result
View All Result
  • Home
  • Business
  • Commodities
  • Crypto News
    • Block chain
    • Bitcoin
    • Ethereum
    • Litecoin
  • Finance
    • Financial Advisors
    • Personal Finance
    • Market Insider
  • Forex
  • Investing
  • Stocks
  • ICOs
  • Trading

© 2022 JNews - Premium WordPress news & magazine theme by Jegtheme.