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Gold Up, Crude Oil Down amid China Scare

January 7, 2016 at 10:34 by Vladimir Vyun

Today, commodity markets continued to perform basically the same way as yesterday. Namely, gold was rising while crude oil was falling, reaching the lowest level in more than a decade.

China continued to scare investors by providing a constant stream of bad news. The nation’s stock markets halted trading today after crashing 7 percent at the start of the trading session. Meanwhile, Chinese policy makers devalued the yuan to the lowest level since March 2011. Economists say that the China’s attempts to reenter the currency wars suggest that the state of the nation’s economy might be worse than was thought previously. The bad news pushed energy prices lower, helping precious metals a bit.

Also helping precious metals were yesterday’s policy minutes released by the Federal Reserve. Market participants considered them to be relatively dovish, pushing the dollar slightly lower.

February contract for gold moved higher by 0.4 percent to trade at $1,096.3 per troy ounce as of 10:28 GMT on COMEX today. Silver failed to join the rally as the March contract stayed flat at $13.98 per ounce. Meanwhile, futures for delivery of WTI crude oil in February dropped 3.47 percent to $32.79 per barrel on NYMEX. Brent crude slid 3.01 percent to $33.2 per barrel on ICE.

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

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