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IMF Growth Projections Drive Commodity Markets

October 8, 2014 at 12:16 by Vladimir Vyun

Today’s performance of commodities was largely driven the growth projections of the International Monetary Fund released yesterday. The precious metals market profited from the report, while the industrial metals and the energy markets suffered.

The IMF lowered its forecast for global growth by a small amount: by 0.1 percentage point to 3.3 percent for 2014 and by 0.2 percentage point to 3.8 percent for 2015. While the estimate for US economic expansion was revised upwardly, revisions for most other regions of the world were negative.

Such projections had the expected result: they drove safe assets, like precious metals, higher and growth-related commodities, like industrial metals and crude oil, lower. Gold had additional support from the fact that the outlook for two major consumers, China and India, was not bad. The forecast for China remained unchanged, while India’s growth received a positive revision for this year.

December futures for delivery of gold rallied 0.40 percent to $1,217.20 per troy ounce as of 12:04 GMT on COMEX today. Contract for copper lost 0.18 percent to $3.0335 per pound. November futures for WTI crude oil declined as much as 0.84 percent to $88.10 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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