Gold prices edged higher in Asia on Friday with jobs data in the U.S. - 6 Jan 2017

Commodity Intraday Tips

Gold prices edged higher in Asia on Friday with jobs data in the U.S. eyed for signals on the prospects of the Fed rate hike path in 2017. Gold for February delivery on the Comex division of the New York Mercantile Exchange eased 0.20% to $1.178.95 a troy ounce. Nonfarm payrolls data from the U.S. later Friday is expected to set the tone for gold as it is sensitive to higher interest rates and a stronger dollar. The Fed in December forecast as many as three rate hikes in 2017. Overnight, gold prices rallied to a four-week high on Thursday, as the U.S. dollar stepped further away from a 14-year peak against a basket of major currencies following the release of commentary from the Federal Reserve. 


LME copper is expected to move at USD 5,550-5,650/mt during Asian trading hours on Friday and SHFE 1703 copper will move at RMB 45,200-45,950/mt. In China’s domestic market, spot copper should trade at discounts of RMB 120-40/mt on Friday. Eyes should be on US nonfarm payroll report in December, unemployment rate and salary growth on Friday, and any change will make effect on foreign exchange market, affecting market’s sentiment in base metal market. Although US dollar index kept falling on Thursday night, most base metals both on SHFE and LME markets dropped after meeting resistance from the moving averages. Base metals are expected to keep performing mixed on Friday. US’ snonfarm payroll report will increase 180,000 in December after seasonal adjustment and unemployment will expand to 4.7%. Average hourly salary will rise 0.3% MoM and 2.8% YoY in December. 


Oil prices were steady on Friday as the start of supply cuts by Saudi Arabia and Abu Dhabi supported the market, but doubts that all producers will implement output reductions agreed in a landmark deal last year kept markets from rising further. Thursday's prices rose following reports of supply cuts from Saudi Arabia and Abu Dhabi coming into effect as part of efforts by the Organization of the Petroleum Exporting Countries (OPEC) and other producers to curb a global supply glut. Overall supply from OPEC in December fell slightly to 34.18 million barrels per day (bpd) from a revised 34.38 million bpd in November, according to a Reuter’s survey this week based on shipping data and information from industry sources. While traders said oil markets were well supported by the agreed cuts, they said doubts remained that all producers would fully implement planned reductions. 

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