Gold prices fell on Monday towards the four-week lows hit last week as the dollar strengthened after U.S. politicians approved a major tax overhaul and the market looked ahead to a meeting of the Federal Reserve later this month.
BULLION :- Gold prices fell on Monday towards the four-week lows hit last week as the dollar strengthened after U.S. politicians approved a major tax overhaul and the market looked ahead to a meeting of the Federal Reserve later this month. The U.S. Senate approved a tax reform bill on Saturday, moving U.S. President Donald Trump a big step closer to his goal of cutting taxes for businesses and the rich while offering everyday Americans a mixed bag of changes. Lower oil prices could mean subdued price pressure, which is a negative for gold, often used as a hedge against inflation. The dollar was boosted by expectations that tax cuts would boost growth, which could fuel inflation and reinforce the case for higher U.S. interest rates when the U.S. central bank meets on Dec. 12 and Dec. 13.However, on Friday two Federal Reserve policymakers urged caution in raising interest rates.
ENERGY :- Oil fell more than 1 percent on Monday as the market saw signs of continuing U.S. production increases, though prices remained in sight of their recent two-year highs thanks to last week’s decision by OPEC and other producers to extend output cuts. Brent crude futures fell $1.00 a barrel to $62.73 by 10:40 a.m. EST (1540 GMT), while U.S. West Texas Intermediate futures were down 70 cents at $57.66. Brent hit a two-year high of $64.65 a month ago and has since attracted record investment by fund managers. The market is continuing to watch U.S. crude production, which is nearing a record high, according to data last week. Additionally, drillers in the United States added two oil rigs in the week to Dec. 1,bringing the total count to 749, the highest since September, energy Services Company Baker Hughes said on Friday .The U.S. rig count, an early indicator of future output, has risen sharply from 477 active rigs a year ago after energy companies boosted spending plans for 2017. U.S. producers were encouraged during 2017 to increase activity as crude prices started recovering from a multi-year price slump after the Organization of the Petroleum Exporting Countries (OPEC) and some non-OPEC producers, including Russia, agreed to production cuts a year ago.
Last week the producers agreed to extend those cuts of 1.8 million barrels per day (bpd) until the end of next year.
BASE METAL :- Nickel gained on Monday as the metal mainly used in stainless steel got a boost after Chinese steel futures touched three-month highs, but a firmer dollar capped the rise. Steel and iron ore contracts in Shanghai surged on Monday as government-ordered steel production cutbacks to reduce pollution led to tighter supplies for some mill products. The stronger prices might not last long because eventually the steel production cutbacks during the peak Chinese smog season in the winter would mean less need for nickel. Weighing on the wider metals complex was a rebound in the dollar after the U.S. Senate approved a tax overhaul at the weekend. A firmer dollar makes commodities priced in the greenback more expensive to buyers using other currencies. LME three month copper dipped 0.3 percent to $6,815 a tonne. China’s economic growth target for 2018 will reflect new changes in the economy as the government puts more emphasis on higher quality development, the State Council Information Office said on Monday. LME aluminium fell 0.3 percent to $2,069 a tonne. China’s central Shanxi province has introduced new rules curbing water use for steel, cement and aluminium production.
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