Oil and Gold Prices Hold Gains while Copper Price Dwindles
New York (Apr 12) Oil prices held above $40 per barrel in both WTI and Brent futures, ahead of an oil-producers meeting to discuss an output freeze at January's levels. Major producers from the Middle East and Russia will attend the April 17 summit, although tensions remain after Iran and Libya expressed their non-committal stance. The oversupply currently reigns over oil market sees between 1 million and 2 million barrels of excessive crude produced daily. WTI oil reached a three-week high of $40.75 today and higher moves are not ruled out as the market hopes for a positive outcome.
Gold prices rallied to a three-week high of $1260.06 as US and European equities subsided and the US dollar stayed under pressure against risk currencies. Investors will look to U.S. retails sales data this week for further clues on how the economy is faring, which would affect monetary policy by the Federal Reserve. Gold prices have rallied since early January as investors scaled back projections for U.S. interest rate rises, making it more attractive against interest-bearing assets.
Copper prices traded flat above a seven-week low and support level at $2.0670 amid broad dollar weakness. This support level has held for four sessions thus a breach would likely trigger a sharp sell-off. Asian stocks also traded mutedfor most of the day with Japanese shares dipping on a bullish yen.China's copper producer prices fell less than expected in March and consumer inflation stabilised, signalling that deflationary pressures have abated. Howeveran upcoming slack in seasonal demand may keep prices in check.