Copper and gold were just in positive territory in the US on Monday morning although trade is muted and an eight-month high in the dollar is capping the upside.
Copper for December settlement on the Comex division of the New York Mercantile Exchange was last up 0.05 cents or less than 0.1% at $2.0890 per pound. The contract had ended lower on the nine previous trading days.
A stronger dollar, questions about Chinese growth and signs that the global copper market is starting to slow had weighed on copper last week.
The refined copper market was in a surplus of 133,000 tonnes in July, primarily due to multi-year lows in Chinese imports, the International Copper Study Group (ICSG) reported.
Comex gold for December delivery rose $3.90 or 0.3% to $1,271.60 per oz. Trade has ranged from $1,262.70 to $1,271.80 so far.
Investor interest in gold has eased, with holdings in the exchange-traded funds (ETFs) tracked by FastMarkets falling 13.2 tonnes over the weekend to 2,161 tonnes.
In currencies, the dollar index was at an eight-month high at 98.61, keeping commodities in check. The dollar was recently 0.1% softer at 1.0896 against the euro.
The yuan earlier dropped to a six-year low this morning amid growing concerns of Chinese debt. Concerns about the health of the Chinese economy emerged last week despite GDP growth of 6.7% in the third quarter.
While the headline figure is positive, industrial production and manufacturing figures have disappointed repeatedly and the country’s housing market is showing signs of overheating.
On the macro front, investors will scrutinise the release of third-quarter US GDP growth on October 28 – consensus is for an increase 2.5% quarter-on-quarter after 1.4% in the previous quarter and 0.8% in the first. Any deviation is likely to affect US monetary policy, the dollar and global risk sentiment.
In a light data day, the flash manufacturing PMI is due from the US later today. Federal Reserve members William Dudley and James Bullard are also scheduled to speak.
With the Federal Open Market Committee (FOMC) not expected to lift US interest rates until December, gold has been confined to a narrow trading range over the past few weeks.
In other commodities, light sweet crude (WTI) oil futures on the Nymex declined 67 cents or 1.3% to $50.18 per barrel while Comex silver for December settlement was recently trading at $17.655 per oz, up 16.2 cents.
In European equities, Germany’s DAX and France’s CAC-40 were both 0.9% higher.
(Editing by Mark Shaw)
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Source: Bullion Desk News
