Gold prices edge down in Asia, but copper firm as supplies eyed
Gold prices dipped in Asia on Tuesday, but copper held gains as investors eye the potential for a prolonged supply disruption from two of the world’s major mines.
Gold for April delivery on the Comex division of the New York Mercantile Exchange fell 0.32% to $1,2385.15 a troy ounce. Silver futures for March delivery eased 0.11% to $18.010 a troy ounce. Copper futures rose 0.22% to $2.756 a pound as concerns over supply disruptions in Chile and Indonesia supported prices as labor strikes at BHP Billiton (LON:LON:BLT)’s Chilean Escondida and Freeport-McMoran (NYSE:FCX)’s Indonesian Grasberg mines continue. Combined, the mines produce roughly 10% of the world’s total copper supply.
Overnight, gold prices were little changed during North American morning hours on Monday, with investors hesitant to take strong positions due to the U.S. national holiday for Presidents Day.
Headlines from Washington will most likely remain in focus in the week ahead, as traders await further details on President Donald Trump’s promises of tax reform, deregulation and infrastructure spending.
Market players also awaited further hints on the timing of the next U.S. rate hike. In the week ahead, global financial markets will focus on minutes of the Federal Reserve’s latest policy meeting as well as housing-related data for more clues on the timing of the next U.S. rate hike.
There are also more than a few Fed speakers this week, including Minneapolis Fed President Neel Kashkari, Philadelphia Fed President Patrick Harker and Atlanta Fed President Dennis Lockhart.
Cleveland Federal Reserve President Loretta Mester said in a speech in Singapore on Monday she would be “comfortable” raising interest rates at this point if the economy maintained its current pace of performance.
Fed Chair Janet Yellen said last week that the U.S. central bank will likely need to raise interest rates at an upcoming meeting, although she flagged considerable uncertainty over economic policy under the Donald Trump administration.
Fed fund futures priced in a less than 15% chance of a rate hike in March, according to Investing.com’s Fed Rate Monitor Tool. Odds of a June increase was seen at around 70%.