Commodities: Choppy day for gold as dollar steadies
Gold futures stabilized on Thursday as the US dollar remained subdued after Wednesday's minutes from the FOMC (Federal Open Market Committee) hinted at a delay in any rate hikes in the US.
Regarding the FOMC, not all are convinced of a loose policy going forward, with Dominic Schnider at UBS stating, "The market believes at the moment that there's not much inflation and the Fed need not do much," adding "We disagree, and believe the Fed will in September come with a balance sheet reduction and hike rates in December."
Spot gold was stuck in a $1,281/89 range and the December futures contract traded just 0.05% lower to $1,292/Oz., with Thursday being the quietest day for the precious metal after a turbulent week following US and North Korean tensions as well as the recent communique from the Fed.
"In the shorter term, and in the absence of any geopolitical headlines, traders should watch the performance of the dollar against its G-10 peers for clues to gold's short term direction," said Jeffrey Halley, a senior market analyst at OANDA
Other precious metals saw spot silver trade 0.6% lower to $17.03/oz. by 1700 BST while palladium rallied to it's highest level this year so far, up 0.3% to $929.30/oz. while platinum closed the day 0.29% higher to $978.40.
In base metals, Thursday saw copper trade lower 1.05% on the day to $6,492/tonne, though it is still flirting with two-year highs, and iron ore closed marginally lower at $557.
A weaker dollar and a robust Chinese property sector have supported metals prices, said analyst Daniel Morgan of UBS in Sydney.
"People have been waiting for the property slowdown in China to weigh on demand. We are squarely in the third quarter now and that hasn't happened ... every month things are okay," he said.
"Overall, the space is pretty healthy. Miners are making good money now and I think they should be expecting to for quite a few months."
Energy markets rallied as attention turned towards US oil stockpiles declining after an industry report suggested inventories at the Cushing, Oklahoma hub were declining. September WTI was up 0.47% to $47.13/barrel while benchmark brent for October delivery was up 1.03% to close at $51.
"Yesterday, the production number trumped the storage number, but it was still a draw of 9 million," said Bob Yawger, director of energy futures at Mizuho. "There are some weaker shorts that are probably sold out and they want to get out."
Recent efforts by OPEC and other producers to drain a global fuel glut have been undermined by rising output in the US who's shale output now stands at record levels.