GOLD & CRUDE OIL TALKING POINTS:
- Gold prices[1] fall on hawkish shift in Fed rate hike expectations
- Crude oil prices[2] shrug off EIA inventory data, focus on OPEC+
- Markets eyeing OPEC Seminar, US-China trade war news flow
Gold prices fell for a fourth day, hitting a six-monthlow. The move tracked inversely of a rise in US Treasury bond yields as the priced-in rate hike path implied in Fed Funds futures steepened. Hawkish comments from Fed Chair Jerome Powell at the ECB Forum as well as a broader recovery in risk appetite that bolstered confidence in the US central bank’s ability to proceed with tightening likely drove the move.
Meanwhile, crude oil prices failed to make good on an upswing after EIA data showed inventories fell more than expected last week as all eyes remain on Friday’s OPEC+ meeting in Vienna. That will update the group’s strategy on its coordinated production cut scheme. Russia and Saudi Arabia are pushing to relax output curbs, a move opposed by some top exporters (such as Iraq).
GOLD EYES TRADE WAR NEWS, OPEC SEMINAR CONTINUES
Looking ahead, a lull in top tier scheduled event risk may give gold prices some room to digest losses before the next trend move. Still, markets remain highly sensitive to headlines informing how the US-China trade war might progress[3]. A stray soundbite from either Washington or Beijing may yet engage sentiment trends, translating into a volatility for the yellow metal.
Background
