U.S. oil prices hit highest since 2015, but doubts loom over rally

Gold Prices Dip In Asia Despite Support From A Weaker Dollar, Japan Wages.

Gold prices fell slightly in Asia on Tuesday even as a weaker dollar offered some support and Japan wages data showed a surprise upside. Atlanta Fed President Raphael Bostic said Monday while he supported the Federal Reserve “slow removal” of monetary policy accommodation, the central bank may not need to raise rates three or four times per year. Bostic struck a more dovish tone than his San Francisco counterpart Fed Williams, who on Saturday said three rates remained appropriate for 2018 amid expectations that President Donald Trump’s tax reform plans would give the economy a boost. The Bank of Canada could raise rates as soon as next week, Action Economics said, as a recent swathe of positive data on the labor market may force the central bank’s hand on monetary policy tightening.

Aluminium scrap sees tighter supply in 2018.

Aluminium scrap is set to see tightened supply in 2018 as environmental protection policies weigh in further. SMM believes such tightness would be mostly felt around Chinese New Year and the fourth quarter when demand increases. In fact, secondary aluminium producers have started restocking ahead of the Chinese New Year holiday but their inventory levels hardly grew. Sources told SMM that their stocks could last just seven to 10 days of production. The tightening supply of aluminium scrap is mainly due to environmental protection measures and policy changes on imported materials.

China's zinc smelters see lower operating rates in December.

The operating rates at zinc smelters in December dropped 4.16 percentage points from the previous month with companies of all sizes seeing declines. Even though some smelters have come out of their maintenance schedules and Hunan Kingstone Mining has resumed its production, overall output was down over 20,000 mt from November, according to SMM research. Shorter supply of zinc ore and dry season have led to lower production at smelters. In addition, the ongoing environmental inspection in Huayuan county in Hunan saw smelters stop or cut output.

U.S. oil prices hit highest since 2015, but doubts loom over rally.

U.S. oil prices hit their highest since 2015 again on Tuesday as speculators bet on further price rises amid OPEC-led production cuts and a dip in American drilling activity, though some warned the rally could run out of steam.Traders said prices were mainly being driven by speculative money being poured into crude futures on the notion of a tighter market following a year of production cuts led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia, which are set to last through 2018. "Speculators continued to increase their net long in ICE Brent ... According to exchange data, speculators increased their position by 4,175 lots to leave them with a record net long of 565,459 lots," ING bank said in a note.

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