Gold Dips In Asia In Light New Year Trade With Focus On Fed Minutes

Gold Dips In Asia In Light New Year Trade With Focus On Fed Minutes - Gold eased slightly in Asia on Tuesday in light trade with Tokyo markets shut and the focus ahead on the Fed minutes later this week. Market watchers will also focus on Wednesday’s minutes of the Fed’s December policy meeting for further hints on the future path of monetary policy. For the year, the precious metal gained 14%, the largest yearly percentage gain since 2010. Recent weakness in the dollar has supported gold prices by making the dollar-denominated metal cheaper for holders of other currencies. The dollar fell to its lowest levels in more than three months against a basket of the other major currencies on Friday and posted its largest annual percentage decline since 2003. The index started 2017 at a 14-year high, boosted by hopes for U.S. President Donald Trump’s pro-growth economic agenda. But barring a sweeping tax overhaul enacted last week, the Trump administration has struggled to pass legislation. The dollar also lagged despite the Federal Reserve’s rate increases amid increased investor expectations for other central banks to reduce their stimulus. Geopolitical risks also remain a focus for gold buyers, as gold is a haven asset that many investors favor when they think markets might turn rocky.

Lead price to see slower increase on dispersed restocking - Lead price increase in January may disappoint suppliers as their hope on restocking ahead of the Chinese New Year holiday in mid-February may not materialize the way they anticipated.
SMM learned that downstream storage battery companies planned to scatter their restocking activities due to rising lead prices. Sources told SMM that they would extend the restocking period to two months, from the usual one month, to avoid having the lower hand in price negotiations.

Oil rises to mid-2015 high in strongest year opening since 2014 - Oil prices had their highest January opening since 2014 on Tuesday, with Brent and WTI crude prices rising to mid-2015 highs, supported by ongoing supply cuts led by OPEC and Russia as well as strong demand. U.S. West Texas Intermediate (WTI) crude futures (CLc1) were at $60. It was the first time since January 2014 that both crude oil benchmarks opened the year above $60 per barrel. "Falling inventories globally and strong economic growth offset the restart of the Forties pipeline and the resumption of production following a pipeline outage in Libya," said Jeffrey Halley, senior market analyst at futures brokerage Oanda in Singapore. The 450,000 barrels per day (bpd) capacity Forties pipeline system in the North Sea returned to full operations on Dec. 30 after an unplanned shutdown. More fundamentally, oil markets have been supported by a year of production cuts led by the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC) and Russia. The cuts started in January 2017 and are scheduled to cover all of 2018. Strong demand growth, especially from China, has also been supporting crude.

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