Gold prices edged lower on Friday, as a recovery in the U.S. dollar and stronger global equity markets
dented the metal’s safe-haven appeal, prompting market players to take profits after a sharp rally the
day before. Gold for April delivery on the Comex division of the New York Mercantile Exchange slumped
$10.70, or 0.85%, to end Friday’s session at $1,254.30 a troy ounce. The dollar recovered from a fivemonth
low on Friday, as investors bought back greenbacks ahead of the weekend following an
aggressive selloff earlier in the week. For the week, gold prices dipped $2.20, or 0.39%, the fourth losing
week in five. Despite recent losses, prices of the yellow metal are up nearly 16% so far this year as
investors seek safe havens in the face of mounting instability in other financial markets and as fears over
a China-led global economic slowdown make it tougher for the Fed to raise rates.
SILVER
Comex, Silver futures retreated from the strongest level in more than four months as a round of profittaking
weighed. Silver for May delivery slumped 22.2 cents, or 1.38%, on Friday to close at $15.81 a troy
ounce, after rallying to an intraday peak of $16.17, the most since October 28. On Thursday, silver prices
soared 81.4 cents, or 5.35%, tracking strong gains in gold. For the week, prices logged a gain of 29.1
cents, or 1.32%. The Fed scaled back forecasts for how high interest rates will rise this year following the
conclusion of its policy meeting on Wednesday, citing the potential impact from weaker global growth
and financial market turmoil on the U.S. economy. Investors and economists dialed back their own rate
hike expectations in wake of the Fed’s surprisingly dovish outlook, with traders of interest-rate futures
now seeing no rate rise before September.
COPPER
Copper ratcheted up this week to end at 2.286 seeing a gain of 2.10% as global commodities soared on
dollar weakness. Market analysts attributed the rise in copper futures trade to a firming trend in the
base metals pack at the LME as the recovery in China's property market accelerated, triggering optimism
of demand recovery in the world's biggest commodities consumer. China's annual meeting of parliament
ended much as it began, with a stream of assurances by Premier Li Keqiang that the economy was facing
difficulties but not in danger of a hard landing, fanning hopes its slow revival may gain steam. "This rally
we've had across commodities and stocks in risk appetite ... a lot of it is on a hope you have China
strengthening this year," said Daniel Morgan at UBS in Sydney, adding that prices may have overshot
fundamentals. Copper price also jumped 1 percent to hit the highest since November after the dollar
plummeted. It looks to post gains for a fourth week in five by this week’s close. Industrial metals gained
further as China’s home price data rose at the fastest pace in almost two years, boosting demand
optimism in metals.
CRUDE OIL
Crude Oil soared the later part of the week setting a new 2016 high to close the week at 41.42 with a
weekly gain of 3.95% as trader’s hopes of production cuts helped support gains. US crude prices slipped
after trading above $41 a barrel for the first time since early December as the weekly US oil rig count
rose for the first time since December. US crude settled up for a fifth straight week. Crude prices settled
lower yesterday after the U.S oil rig count rose for the first time since December, renewing worries of a
supply glut after an output freeze plan helped boost the market to 2016 highs and multi-week gains.
U.S. energy firms this week added one oil rig after 12 weeks of cuts, according to data by industry firm
Baker Hughes. Over the past two months, prices rallied to reach above $40 after the Organization of the
Petroleum Exporting Countries (OPEC) floated the idea of a production freeze at January’s highs.
NATURAL GAS
Natural Gas gained almost 4% this week to trade at 1.894 as traders bought up the cheap commodity
head of spring summer demand from driving and air conditioning season. Natural gas prices edged back
Friday, ending a three-day rally, as the outlook for gas-fired heating demand wavered in the waning days
of winter. Forecasts in recent weeks have called for an early end to winter, with temperatures well
above normal in most parts of the country. But that has begun to shift in recent days with variability
coming into the picture, including more cold than previously expected in the Midwest and more heat.
Speculators in four major NYMEX and ICE markets decreased their bearish bets by 25,118 contracts to
74,872 in the week to March 15, the U.S. Commodity Futures Trading Commission said on Friday. That
was the biggest weekly decline in net shorts since mid-January. U.S. natural gas speculators cut their net
short positions for the first week in five as the market started to focus on the upcoming summer when
analysts expect prices to rise, shrugging off the last weeks of what has been a warmer-than-normal
winter.
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