U.S. natural gas prices closed higher on Tuesday after the inability to break through Monday’s low triggered a short-covering rally.
Gold Prices Lower Ahead of Federal Reserve Minutes – Gold prices were lower on Wednesday as investors awaited the minutes of the Federal Reserve’s September policy meeting later in the day, which were expected to reinforce expectations for a December rate hike. Expectations that the Fed will raise interest rates in December pressured prices lower. At its September meeting the Fed indicated that it intends to raise rates once more this year and three times in 2018. Interest rate futures are currently pricing in around a 90% chance of a December rate hike according to Investing.com’s Fed Rate Monitor Tool. Gold struggles to compete with yield-bearing assets like Treasuries as borrowing costs rise. The losses came after gold prices advanced in the previous three sessions, rebounding after a recent selloff that was fueled by interest rate concerns and a stronger dollar. Heightened geopolitical tensions in North Korea and Spain since the start of the week had also underpinned safe haven demand for the precious metal. Many investors favor gold during times of uncertainty or upheaval.
Crude Oil Prices Rise Amid Signs That Market is Tightening – Crude oil prices were higher for a third day on Wednesdays amid indications that the market is gradually rebalancing after years of oversupply. Prices remained supported after Saudi Arabia announced plans on Monday to cut monthly exports in November. The move is part of ongoing efforts led by the Organization of the Petroleum Exporting Countries with other producers, including Russia, to curb oversupply and stabilize prices by cutting output in a deal which is due to expire in March 2018. The gains came ahead of a data-heavy week for oil, which traders would shed more light on efforts to end years of overproduction that led to a massive global supply glut. Oil traders were awaiting OPEC’s monthly report on Wednesday and the International Energy Agency monthly report on Thursday for updated supply and demand forecasts. Meanwhile, analysts and traders expect weekly data from the U.S. Energy Information Administration to show a decline in crude stockpiles for the week ended Oct. 6. The EIA report is scheduled for release on Thursday. The American Petroleum Institute is scheduled to release its inventory data for last week at 4:35 ET (08:30 PM GMT) on Wednesday. The market was also waiting on President Donald Trump’s decision on Thursday on whether or not to certify Iran’s compliance with the international nuclear deal. The Persian nation is an OPEC member and key Middle Eastern oil producer.
Natural Gas – U.S. natural gas prices closed higher on Tuesday after the inability to break through Monday’s low triggered a short-covering rally. There were no major shifts in the fundamentals so the move was likely fueled by price action related to oversold technical conditions. According to natgasweather.com for the October 11 to 17 period, “A weakening weather system will bring showers to portions of the eastern U.S., although still quite mild.” “It remains chilly over the Rockies and Plains, but with comfortable conditions over Texas and the South.” “High pressure will strengthen east of the Plains late in the week into next week where above normal highs of 60s to lower 80s will impact the Great Lakes to Northeast, with 70s to lower 90s across the southern U.S.” “The West will see a mix of warm and cool, averaging out near normal.” “Overall, demand will be Moderate to low.”
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