Commodity Capsule: Oil prices edged up on Monday as traders watched for supply disruption risks in the Middle East.
Strikes by US and British forces to stop the Houthi militia in Yemen from attacking ships in the Red Sea are supporting crude oil prices.
Brent crude futures hovered around $78.42 a barrel. WTI crude traversed $72-73 a barrel.
Both the oil benchmarks jumped more than 2 per cent last week to touch their highest intraday levels this year.
On Sunday, the Houthi militia threatened a “strong and effective response” after the United States carried out another strike overnight
President Joe Biden said the United States had sent a private message to Iran about the Houthi attacks.
Gold prices rose on Monday holding past $2,050 an ounce mark.
Yellow metal recouped most of their new year’s losses.
Persistent tensions in the Middle East drove safe-haven demand, while traders still held out for early interest rate cuts by the Federal Reserve.
Yellow metal witnessed increased demand as a conflict between the US and the Houthi group marks a potential spillover in the Israel-Hamas war.
Mixed U.S. inflation readings saw traders largely maintain their bets that the Fed could begin cutting interest rates as soon as March 2024
Bullion’s weekly performance was largely flat, in positive territory.
Copper prices bounced back on Monday following a weak start to the new year.
LME copper and Aluminum have managed to rebound from five-week and one month lows, respectively.
Negative signals from China dampened the outlook for the red metal.
Most metals on London Metal Exchange, extended negative weekly performance for the week ended January 12.
PBoC unexpectedly kept its medium-term lending rates on hold on Monday, indicating limited headroom to further loosen monetary conditions and support a fragile economic recovery.
Monday’s move points to no changes in China’s benchmark loan prime rate, heralding limited levels of monetary stimulus for the economy
Chinese trade data on Friday showed a drop in copper imports in December, amid high inventory and increased domestic output.
China will release its fourth-quarter gross domestic product and December industrial production on Wednesday.
Copper prices, meanwhile, were supported by mine-side disruption.
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