Commodity prices largely shrugged off comments this week by the US Commerce Secretary that the US and China were “miles and miles” away from a trade deal. But the outlook for trade talks may take centre-stage next week as the Chinese Vice-Premier Liu He is expected in Washington on Wednesday. We think signs of progress with the talks would be positive for nearly all commodity prices, with the notable exception of gold.
Next week is also busy on the data front, with the release on Friday of China’s official January PMI and the December US employment report. We expect China’s PMIs to weaken further, which could depress the prices of industrial metals. The Fed is also set to meet for its two-day policy meeting which, for the first time at a January meeting, will conclude with a Wednesday press conference. We are not expecting a big reaction in commodity markets as the Fed is more than likely to re-iterate its “patient” approach to further interest rate hikes given concerns about global growth and the ongoing government shutdown.
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