Gold gains as Chinese inflation rate beats expectations
Gold prices rose on Tuesday after Chinese inflation data beat expectations and bolstered the yellow metal's allure as a hedge to rising consumer prices.
China reported earlier that consumer prices rose 2.7% in June from a year earlier, above expectations for a 2.5% increase and accelerating from a 2.1% rate of increase in May.
Rising consumer prices often boost gold's appeal as a hedge.
Gold also rose amid sentiments that the metal may be oversold due to firming U.S. indicators that have strengthened the dollar, which tends to trade inversely with gold.
On Friday in the U.S., the Bureau of Labor Statistics reported the U.S. economy added 195,000 nonfarm payrolls in June, well above analysts' calls for a 165,000 increase.
The numbers fueled speculation that the Federal Reserve will begin tapering stimulus programs in the coming months.
Stimulus measures such as the Fed's monthly USD85 billion bond-buying program weaken the dollar and bolster gold, though talk of their dismantling has the reverse effect.
On Wednesday, the Federal Reserve will release the minutes of its June monetary policy meeting, which investors hope will provide more insight into the fate of stimulus measures that have sent gold prices soaring in recent years, though until then, bottom fishers pushed the precious metal higher meeting on Wednesday, hoping to gain further insight on the direction of U.S. monetary policy.
Crude gains on Egypt unrest, stronger dollar weighs
China reported earlier that consumer prices rose 2.7% in June from a year earlier, above expectations for a 2.5% increase and accelerating from a 2.1% rate of increase in May.
Rising consumer prices often boost gold's appeal as a hedge.
Gold also rose amid sentiments that the metal may be oversold due to firming U.S. indicators that have strengthened the dollar, which tends to trade inversely with gold.
On Friday in the U.S., the Bureau of Labor Statistics reported the U.S. economy added 195,000 nonfarm payrolls in June, well above analysts' calls for a 165,000 increase.
The numbers fueled speculation that the Federal Reserve will begin tapering stimulus programs in the coming months.
Stimulus measures such as the Fed's monthly USD85 billion bond-buying program weaken the dollar and bolster gold, though talk of their dismantling has the reverse effect.
On Wednesday, the Federal Reserve will release the minutes of its June monetary policy meeting, which investors hope will provide more insight into the fate of stimulus measures that have sent gold prices soaring in recent years, though until then, bottom fishers pushed the precious metal higher meeting on Wednesday, hoping to gain further insight on the direction of U.S. monetary policy.
Crude gains on Egypt unrest, stronger dollar weighs
Crude prices moved slightly higher on Tuesday on lingering fears that unrest in Egypt may spread across the region and disrupt global supply, though a stronger dollar capped gains.
A stronger greenback makes oil a less attractive commodity in dollar-denominated exchanges, especially in the eyes of investors holding other currencies.
On the New York Mercantile Exchange, light sweet crude futures for delivery in August traded up 0.17% at USD103.32 a barrel on Tuesday, off from a session high of USD103.47 and up from an earlier session low of USD102.31.
Egypt's interim government worked to amend the country's constitution and also set parliamentary and presidential elections for early 2014 though fears unrest my affect the flow of oil through the Suez Canal sent prices climbing.
Violent clashes between supporters and opponents of ousted President Mohamed Morsi left more than dozens of people dead, according to various reports.
A stronger dollar dampened oil's advance.
The IMF cut its 2013 global growth forecast to 3.1% from a 3.3% prediction made in April and cut its 2014 growth forecast to 3.8% from 4.0%, which sent investors snapping up safe-haven positions in the dollar.
A stronger greenback makes oil a less attractive commodity in dollar-denominated exchanges, especially in the eyes of investors holding other currencies.
On the New York Mercantile Exchange, light sweet crude futures for delivery in August traded up 0.17% at USD103.32 a barrel on Tuesday, off from a session high of USD103.47 and up from an earlier session low of USD102.31.
Egypt's interim government worked to amend the country's constitution and also set parliamentary and presidential elections for early 2014 though fears unrest my affect the flow of oil through the Suez Canal sent prices climbing.
Violent clashes between supporters and opponents of ousted President Mohamed Morsi left more than dozens of people dead, according to various reports.
A stronger dollar dampened oil's advance.
The IMF cut its 2013 global growth forecast to 3.1% from a 3.3% prediction made in April and cut its 2014 growth forecast to 3.8% from 4.0%, which sent investors snapping up safe-haven positions in the dollar.
Natural gas prices fall as weather forecasts point to milder temperature
Natural gas prices fell on Tuesday after updated weather forecasting models toned down their calls for above-normal temperatures settling in for the heavily populated eastern half of the country.
Rising summer temperatures often hike the need for gas-fired electricity to cool homes and businesses, which increases demand for natural gas, though pockets of milder temperatures can send prices falling.
Weather forecasting models continued to call for above-normal temperatures for parts of the eastern U.S. though for a smaller area than previously forecast.
The National Weather Service issued a 10-day forecast calling for above-normal temperatures for the northeastern U.S. but added that normal to below-normal readings will be found for the remainder of the country.
Traders also kept an eye on U.S. inventory levels. Total U.S. natural gas storage stood at 2.605 trillion cubic feet as of last week, just 1.1% below the five-year average and 16% below last year's level.
Economic Events for the Day
Rising summer temperatures often hike the need for gas-fired electricity to cool homes and businesses, which increases demand for natural gas, though pockets of milder temperatures can send prices falling.
Weather forecasting models continued to call for above-normal temperatures for parts of the eastern U.S. though for a smaller area than previously forecast.
The National Weather Service issued a 10-day forecast calling for above-normal temperatures for the northeastern U.S. but added that normal to below-normal readings will be found for the remainder of the country.
Traders also kept an eye on U.S. inventory levels. Total U.S. natural gas storage stood at 2.605 trillion cubic feet as of last week, just 1.1% below the five-year average and 16% below last year's level.
Economic Events for the Day
Time
|
Cur.
|
Event
|
Actual
|
Forecast
|
Previous
|
16:30
|
USD
|
MBA Mortgage Applications (WoW)
|
-11.70%
| ||
19:30
|
USD
|
Wholesale Inventories (MoM)
|
0.30%
|
0.20%
| |
20:00
|
USD
|
Crude Oil Inventories
|
-3.300M
|
-10.347M
| |
20:00
|
USD
|
EIA Weekly Distillates Stocks
|
1.310M
|
-2.418M
| |
20:00
|
USD
|
Gasoline Inventories
|
1.160M
|
-1.719M
| |
22:30
|
USD
|
10-Year Note Auction
|
2.21%
| ||
23:30
|
USD
|
FOMC Meeting Minutes
| |||
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