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Commodities Halt Rally amid Shifting Outlook for Fed Policy

September 22, 2015 at 12:38 by Vladimir Vyun

Commodities were in decline today following yesterday’s attempts to rally. Prices for raw materials had risen after the Federal Reserve policy announcement, but the rally has halted as traders re-evaluated their outlook for Fed’s future monetary policy. While markets participants thought after the Fed announcement that the US central bank is going to postpone the interest rate hike, now they changed their view, especially after hawkish comments by several US policy makers.

On the other end of the spectrum are central banks of other developed nations, including the European Central Bank, that have an easing bias. Such divergence in policies is helpful for the US dollar, and by the same token it is detrimental for dollar-priced commodities.

Additionally, there are worries about slowing global growth. China is particularly important source of concern, being the world’s second biggest economy and a major consumer of raw materials.

December futures for gold declined 0.42 percent to $1,128 per troy ounce as of 12:31 GMT on COMEX today. Copper slid as much as 2.49 percent to $2.329 per pound. October contract for WTI crude oil dived 2.63 percent to $45.45 per barrel on NYMEX.

If you have any questions and comments on the commodities today, use the form below to reply.

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