It has been a disappointing week for commodity prices, against a backdrop of a stronger dollar and the likelihood of an imminent rate hike in the US. The strong US employment report on Friday removed the last obstacle to Fed tightening. Investor selling goes some way to explaining this week’s price falls, particularly in the case of oil, copper and gold.
The focus next week will remain on the Fed which is expected to hike interest rates by 25 basis points on Wednesday. While the move is widely anticipated, gold prices could fall further in the event. That said, the triggering of Article 50, which would officially start the Brexit process, could lend some support to gold prices over the coming weeks. Otherwise, on Tuesday, China’s industrial output and investment data will provide an indication of the strength of metals demand in the first two months of the year.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services