Oil prices fell on Tuesday for a second day as rising U.S. output and a strengthening dollar- 30 Jan 2018

Gold Slips In Asia In Cautious Trade Ahead OF Fed Meeting Start. 

Gold prices slipped in Asia on Tuesday as the dollar edged up ahead of the start of a two-day FOMC meeting with rates seen steady, but views on inflation expected to have an impact on the market. Overnight, gold prices fell on Monday in the wake of a sharp move higher in the dollar amid investor expectations that solid economy growth and faster inflation would strengthen the Federal Reserve’s case for a more aggressive approach to monetary policy. Goldman Sachs (NYSE:GS) said it expects the Federal Reserve bank to adopt a slightly hawkish slant in its commentary related to economic conditions and inflation, when the central bank releases its policy statement due Wednesday. 

Analysis: Zinc price sees further upward room.

As the SHFE 1803 zinc contract refreshed its 10-year high and touched 27,235 yuan/mt on Monday January 29, SMM believes new highs may continue to be made. Such strong momentum can be attributed to stronger Chinese yuan, declining inventory, and more fund liquidity. In China, zinc concentrate supply stayed tight. Deliveries have also been affected due to poor weather. Social inventories in the three major markets have declined for two consecutive weeks to just below 140,000 mt, according to SMM data. We maintain our view that zinc would stay firm in the first half of this year but a small correction is expected in the near term.

Copper concentrate spot TCs steady ahead of CNY.

SMM’s assessment of imported copper concentrate treatment charges (TCs) stood at $74- 86/mt as of Friday January 26, down $1/mt from a week ago. We expect spot TCs to remain stable at the $80/mt level ahead of Chinese New Year with sluggish trading activity as smelters have mostly finished their restocking. The malfunction of Pasar and Birla smelters saw some long-term contract cargoes flow into the Chinese spot market but the impact on TCs was rather small, SMM learned.

U.S. oil extends decline, weighed down by dollar, rising output. 

Oil prices fell on Tuesday for a second day as rising U.S. output and a strengthening dollar sapped demand for crude, pushing Brent below $70 a barrel.Prices are still heading for a fifth straight monthly gain. "Markets remain fragile to the downside," said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore, citing a jump in the number of rigs drilling for oil in the United States. U.S. production is already on par with Saudi Arabia, the biggest producer in the Organization of the Petroleum Exporting Countries (OPEC). Only Russia produces more, averaging 10.98 million barrels per day (bpd) in 2017. U.S. output has jumped more than 17 percent since mid-2016 and is expected to exceed 10 million bpd soon. The recent rally in oil prices had been fueled by the U.S. dollar's six straight weekly slides. The greenback is down 3 percent so far this month.

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