2024-03-14 09:57

Copyrighted Image by: Reuters. Investing.com - The U.S. dollar edged higher in European trade Thursday, retaining recent strength ahead the release of more cues on U.S. interest rates in the form of producer inflation and retail sales data. At 06:00 ET (10:00 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% higher at 102.490. Dollar gains ahead of U.S. PPI release The dollar received a boost earlier in the week after the release of a stronger-than-expected U.S. consumer price index print earlier this week, which ramped up bets that the Federal Reserve will take its time in reducing interest rates. The U.S. currency has slumped around 1.7% over the last month, hit hard last week by dovish comments from Fed chief Jerome Powell, during his two-day testimony in front of Congress, which were seen by the markets as suggesting the U.S. central bank was preparing to start cutting interest rates in the summer. However, the index is still up around 1.5% this year as U.S. data has shown that the economy remains strong, and Tuesday’s CPI release suggested inflation remains a major sticking point. The focus now turns towards the release of the producer price index for February, in particular, and retail sales for the same month for more clues as to the likely thinking by Fed officials ahead of next week’s policy setting meeting. “PPI will be watched very closely as investors seek confirmation that inflation is not as hot as the CPI report suggested,” said analysts at ING, in a note. “The consensus is 0.2% month-on-month for core PPI, but the whisper number is surely higher after CPI.” Euro lacks volatility; ECB to start cutting soon? In Europe, EUR/USD edged 0.1% lower to 1.0942, with the lack of significant economic data in the eurozone contributing to a lack of volatility. The ECB kept rates at record highs of 4% last week, but traders are looking for the central bank to start cutting interest rates shortly given the slow growth in the region, and in Germany, in particular. The European Central Bank will probably start cutting rates during the spring, French central bank head and ECB policymaker Francois Villeroy de Galhau said on Wednesday, describing spring as between April and June. ECB chief Christine Lagarde earlier this month hinted strongly that a long-awaited rate cut would be more likely to happen at the central bank's meeting in early June, rather than in April. GBP/USD traded 0.2% higher at 1.2816, with the Bank of England widely expected to keep interest rates unchanged when it meets next week, as inflation remains above the central bank’s 2% medium-term target. BOJ meeting looms large In Asia, USD/JPY traded 0.1% higher to 147.82, with the yen handing back some of the recent gains with the Bank of Japan set to meet next week. Reports have suggested that the central bank is very close to ending its ultra-easy monetary policy, especially after an upward revision in GDP data showed the Japanese economy dodging a technical recession in the fourth quarter. USD/CNY edged 0.1% higher to 7.1902, amid persistent doubts over an economic recovery in the country, while AUD/USD rose 0.1% to 0.6624, with strength in commodity prices pushing the Aussie dollar to a near two-month high in recent sessions. https://www.investing.com/news/forex-news/dollar-gains-ahead-of-ppi-release-euro-seeks-ecb-clues-3337409

2024-03-14 06:13

Copyrighted Image by: Reuters. Investing.com-- Gold prices surged to record highs earlier this week, before swiftly consolidating and settling closer to the $2,150 an ounce levels. Analysts at ANZ Group warned that the yellow metal could pull back further in the short term, but hiked their year-end target for bullion. Spot prices hit a record high of nearly $2,200 an ounce at the beginning of the week, buoyed by persistent bets that the Federal Reserve will begin trimming interest rates by June. But hotter-than-expected consumer price index data for February sullied this notion, any more resilience in inflation likely to deter the Fed from cutting rates early. ANZ analysts said that a recent rally in gold had “surpassed macroeconomic and geopolitical developments,” and that a near-term pullback in the yellow metal, to around $2,100 an ounce, appeared likely. ANZ sets $2,300 year-end price target for gold But ANZ analysts also said that they expected U.S. inflation to ease in the coming months, moving back towards the Fed’s 2% annual target and still setting up the bank to begin cutting interest rates from the second half of the year. Specifically, ANZ sees rate cuts coming in July. They upgraded their year-end price target for gold to $2,300 an ounce from $2,200 an ounce, implying an upside of nearly 6% from current levels. ANZ analysts also said that the price pullback was an opportunity to build long positions, and that the recent gold rally also lifted their baseline outlook for the yellow metal. Gold investment to also improve as rates fall ANZ analysts said that investment demand for gold would be a key driver of the yellow metal in the second half of 2024. They noted that higher interest rates had spurred outflows from market-traded gold investment products since 2022, but that these outflows set the stage for a potential rebound. “Given ETF outflows have been in response to monetary tightening over more than a year, they are likely to reverse once central banks start easing. A less crowded investment in gold presents significant upside potential as this leaves more room for increasing gold holdings.” Physical demand for gold, stemming from surprising demand in China and India, was also a key driver of the yellow metal in recent months. But ANZ analysts now expect growth in physical demand to taper off, especially amid slowing consumer spending in China, and to some extent, India. https://www.investing.com/news/commodities-news/after-record-highs-whats-next-for-gold-anz-weighs-in-3337163

2024-03-14 05:46

Copyrighted Image by: Reuters. Investing.com-- Gold prices fell slightly in Asian trade, but kept recent record highs in sight as markets awaited more cues on U.S. interest rates from upcoming producer price index and retail sales data. Among industrial metals, copper prices also retreated in Asian trade, but remained closed to 11-month highs after reports of production cuts by Chinese smelters pointed to tighter markets. Broader metal markets were pressured by some resilience in the dollar before the economic data. Gold prices hover below record highs with more rate cues on tap Spot gold fell 0.2% to $2,171.06 an ounce, while gold futures expiring in April fell 0.3% to $2,175.35 an ounce by 01:27 ET (05:27 GMT). Bullion prices had surged to record highs of around $2,200 an ounce at the beginning of the week, but saw swift consolidation after hotter-than-expected consumer price index data put fears of high interest rates back into markets. The strong CPI reading saw focus turn squarely towards upcoming readings on PPI inflation and retail sales, due later on Thursday. The two are widely expected to factor into the Federal Reserve’s outlook on interest rates. The data prints also come before a Fed meeting next week, where the central bank is widely expected to keep rates steady and signal no immediate plans to begin loosening policy. A slew of Fed officials had warned that interest rate cuts will be largely dictated by the path of inflation in the coming months. Other precious metals consolidated before the upcoming data. Platinum futures fell 0.4% to $942.45 an ounce, while silver futures steadied at $25.170 an ounce. Copper prices cool at 11-mth highs after China-fueled rally U.S. copper futures expiring in May fell 0.5% to $4.0382 a pound, after surging to 11-month highs on Wednesday, while three-month LME copper futures fell 0.5% to $8,884 a metric ton from a nine-month peak. The red metal was boosted chiefly by media reports that China’s biggest copper smelters had jointly agreed to reduce production, although the scope of the planned cuts remained unclear. Doubts also persisted over whether copper prices could maintain their melt-up, especially as the economic outlook for China, the world’s largest copper importer, remained dour. https://www.investing.com/news/commodities-news/gold-prices-consolidate-before-more-rate-cues-copper-rally-cools-3337156

2024-03-14 04:54

Investing.com-- Copper prices rallied over 3% to their highest levels in nearly 11 months, supported chiefly by signs of tighter supplies after Chinese smelters were seen discussing joint production cuts. U.S. copper futures expiring in May surged 3.3% on Wednesday to a 11-month peak of $4.0690 a pound, clearing key psychological levels in the process. Benchmark three-month copper futures on the London Metals Exchange hit a nine-month high of $8,927.0 a metric ton. Copper prices supported by Chinese smelter cuts Gains in the red metal were spurred chiefly by media reports showing China’s biggest copper smelters met to discuss potential production cuts, amid recent weakness in refined copper prices. The move also came amid tightening supply conditions for mined copper, following continued production disruptions in Peru and Chile, the world’s biggest copper producing countries. Both countries saw their copper exports dented by civil unrest over the past year. “Mine supply setbacks are trickling down to refined copper production, pushing prices higher. China’s major smelters discussed to curtail production capacity… raising concerns for refined copper supply. A recent sharp decline in treatment charges led to a discussion around output curbs,” ANZ analysts wrote in a note. But questions still persisted over whether the copper melt-up would last, given that weakening economic conditions in China are also expected to dent the country’s appetite for refined copper. Chinese copper inventories have steadily increased over the past year, raising questions over slowing import demand in the country. A prolonged slowdown in China's real estate sector, which is a key driver of copper demand, was also a key weight on copper prices over the past year. Mining stocks surge on copper spike Major global mining stocks were also buoyed by the spike in copper prices. In Australia, Rio Tinto Ltd (ASX:RIO) and BHP Group Ltd (ASX:BHP), two of the world’s miners, surged more than 2% each. Overnight, U.S.-listed Freeport-McMoran (NYSE:FCX) surged 7.6%, while UK shares of Swiss commodity trader Glencore PLC (LON:GLEN) jumped nearly 5%. https://www.investing.com/news/commodities-news/copper-prices-rally-to-11mth-highs-on-this-key-chinese-signal-3337145

2024-03-14 04:09

Copyrighted Image by: Reuters Investing.com-- Most Asian currencies retreated on Thursday, while the dollar steadied from recent gains as markets sought more cues on U.S. interest rates from producer inflation and retail sales data due later in the day. Regional currencies were still reeling from a stronger-than-expected U.S. consumer price index print earlier this week, which ramped up bets that the Federal Reserve will take its time in reducing interest rates. Dollar steady as data dump comes before Fed meeting The dollar index and dollar index futures steadied in Asian trade on Thursday after reversing some of their gains earlier this week. Focus was largely on more inflation cues from producer price index and retail sales data, especially after Tuesday’s hotter-than-expected CPI print. The data also comes just days before a Fed meeting next week, where the central bank is widely expected to keep rates on hold and offer scant cues on when it plans to begin trimming rates. Japanese yen consolidates as BOJ meeting approaches The Japanese yen, which had mostly outperformed its regional peers this week, relinquished a bulk of its gains on Wednesday and Thursday. Negotiations between major Japanese employers and employee unions pointed to bumper increases in wages over the coming months- a trend that is likely to keep inflation underpinned in the coming months. Sticky inflation and higher inflation are the two biggest considerations for the Bank of Japan to begin winding down its negative interest rates and yield curve control (YCC) policies- a scenario that bodes well for the yen. The BOJ is set to meet next week, with media reports suggesting that an end to negative rates and YCC could come either then or during an April meeting. Recent signs of resilience in the Japanese economy also gave more credence to expectations of a less dovish BOJ. But a former BOJ official said on Thursday that the bank will take its time in normalizing policy after ending its negative interest rate regime- indicating that Japanese interest rates will rise marginally this year. Broader Asian currencies trended lower as focus remained on the upcoming U.S. data. The Australian dollar fell 0.1 after strength in commodity prices pushed a currency to a near two-month high in recent sessions. The Chinese yuan fell 0.1%, amid persistent doubts over an economic recovery in the country. The South Korean won and Singapore dollar lost 0.2% and 0.1%, respectively, while the Indian rupee steadied after recovering sharply from the 83 level this month. https://www.investing.com/news/forex-news/asia-fx-edges-lower-dollar-steady-before-ppi-retail-sales-data-3337131

2024-03-14 02:18

Copyrighted Image by: Reuters. Investing.com-- Oil prices settled at five-month highs Thursday, as the International Energy Agency's upgraded its crude demand growth forecast, easing jitters about a potential supply surplus. At 14:30 ET (18:30 GMT), the U.S. crude futures settled 1.9% higher at $81.26 a barrel, the highest since Nov. 6, and the Brent contract climbed 1.7% to $85.42 a barrel. IEA lifts 2024 demand growth forecast The IEA raised its forecast for world oil demand in 2024, saying it will rise by 1.3 million barrels per day, up 110,000 barrels per day from last month. The agency also forecast first-quarter global demand growth to rise a higher than previously expected 1.7 million barrels per day because of an improved U.S. outlook and firmer bunkering demand owing to longer voyages to avoid the Red Sea. OPEC on Tuesday kept its demand growth forecast unchanged at 2.25 million barrels per day, a substantially higher figure than the IEA estimate. As well as upbeat demand forecasts, "soaring margins will encourage refineries to ramp-up oil processing, supporting oil demand," ANZ Research said in a note following data a day earlier showing a pick-up in U.S. refinery activity. US inventory draws signal improving demand The crude benchmarks had soared more than 3% on Wednesday, after an unexpected draw in U.S. oil and gasoline inventories indicated that demand in the world’s largest fuel consumer was picking up from a winter lull, especially as more refineries resumed operations after an extended winter break. Official data showed that crude inventories shrank by about 1.5 million barrels in the Week to March 8, against expectations for a build of 0.9 million barrels. But the kicker was a 5.7 million barrel draw in gasoline stocks, which was much more than expectations for a 1.9 million draw and marked a fifth week of outsized draws in the past six weeks. The inventory readings signaled tightening oil supplies in the U.S., even as the country produced crude at record-high rates and was forecast to increase production this year. Russian fuel refinery attacks support oil prices Oil prices had also received support from Ukranian drone attacks on a major Russian fuel refinery, which reportedly put the facility out of commission. The move is expected to limit Russia’s fuel output, and also comes amid already tight gasoline markets in the country. Russia had earlier this month enacted a six-month ban on fuel exports - a move that is expected to substantially tighten fuel markets in swathes of Asia. Increased clashes with Ukraine also point to elevated geopolitical risks to oil markets, which are already grappling with the Israel-Hamas war. But despite strong gains, crude prices still remained within a $75 to $85 a barrel trading range established in recent months. More gains in oil prices were held back by concerns over weak Chinese demand and the prospect of higher-for-longer interest rates. https://www.investing.com/news/commodities-news/oil-prices-steady-near-4mth-high-after-russia-attacks-strong-us-fuel-draws-3337110