Price gains for gold, silver; technical buying featured
NEW YORK (February 25) Gold and silver prices are higher in early U.S. trading Wednesday, with silver once again leading the way and scoring a three-week high. The near-term technical postures for both precious metals have become more bullish recently, which is inviting the chart-based traders to the long sides again. Safe-haven demand is also featured in gold and silver, amid a still-uncertain geopolitical environment. April gold was last up $23.00 at $5,198.40. March silver prices were up $3.02 at $90.515.
Boston Fed President: U.S. rates on hold “for some time.” Federal Reserve Bank of Boston President Susan Collins on Tuesday said U.S. interest rates are likely to stay unchanged “for some time” as recent economic data shows an improvement in the labor market, while risks to inflation remain. The labor market is showing “at least some more signs of an unusual kind of stability,” Collins said during a panel discussion hosted by the Boston Fed and as reported by Bloomberg. She also pointed to the need for more evidence that inflation is coming down toward 2%. “I think that it’s quite likely that it will be appropriate to hold the current range for some time,” she said. “After 175 basis points of easing over the past year and a half, we are at mildly restrictive, perhaps quite close to neutral already,” Collins said, referencing the level at which interest rates neither stimulate nor restrain the economy.
Russia, Iran selling discounted oil to China. Russian and Iranian oil producers are offering deepening discounts as they compete for the same limited group of Chinese buyers after India retreated from purchases, Bloomberg said in a report. India’s imports from Russia could drop by 40% from January levels to around 600,000 barrels a day, according to a scenario from Rystad Energy. Much of the displaced cargoes are now heading east, spurring a price war with Iranian suppliers that have long been favored by China’s private refiners. Russia’s Urals grade is selling at around $12 a barrel below ICE Brent, according to traders familiar with such deals, compared with a $10 discount last month. Iranian Light is going for as much as $11 less than the global benchmark, they said, asking not to be named as they’re not authorized to speak to media, said Bloomberg. That’s widened from $8 to $9 in December. “The independent Chinese refiners, known as teapots, have historically acted as the oil market’s pressure valve, absorbing barrels shunned by others. But their capacity is finite, given they only account for around a quarter of the country’s processing capacity and are also subject to government-set import quotas,” said the report. “With China unable to fully soak up the displaced crude, unsold oil is piling up in Asian waters and Russia and Iran are running out of options. “
The key outside markets today see the U.S. dollar index a bit firmer, with crude oil prices slightly up and trading around $65.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.05 percent.
KitcoNews
