Clearly the US economic growth crowd was given a significant boost by the latest US jobs readings, with the headlines trumpeting an 18-year low in unemployment and a gain of 223,000 jobs for May. This should ratchet-up US economic expectations and…
Global Data to Temper Commodity Expectations, But Cautious Optimism For Trade in Asia
The commodity markets are faced with a general downshift in global economic data, and that could serve to temper commodity demand expectations. The ebb and flow of both US/North Korean and US/Chinese flashpoints shifted negative recently, but we continue to think both situations are on the road to being solved favorably. We base this on the evidence that…
Strong Dollar and Trade Uncertainty Potentially Impede Positive Tone in Global Markets
Global markets came through an eventful week last week with a mildly positive tone. US long-term yields continued to rise, with 10-year rates reaching their highest level in nearly seven years. While there were lukewarm readings on retail sales and housing starts, a one-year high was reached in the Philly Fed survey, as well as…
Positive, Big-Picture Developments to Impact Energy, Metals, and Grains
The commodity markets ended last week with a couple of positive, big-picture developments. The most significant is the lack of strong data and inflation measures, as this clearly undermines the dollar and tempers interest rate hike fears. While the energy complex might be poised for a temporary correction, classic fundamentals and the Middle East political situation look to leave oil prices…
Strong Dollar to Restrain Some Commodities, Plus Expanded Market Volatility in Sight
The most recent Federal Reserve meeting was categorized as dovish, with the Fed expected to allow further growth and minor gains in inflation before they move away from a balanced view on rates. Despite this, the equity markets and sentiment as a whole failed to embrace the positives from the meeting. US equities also failed to sustain upside action following a lot of very bullish fundamental news from…
Inflation Predicted to Develop Due to Increases in Dollar, Wages, Energy Prices, and More
Apparently anyone predicting inflation will be wrong just because a large portion of the trade/economist community concludes that it “can’t develop” in the current environment. However, the dollar is rising, wages have been showing some gains, energy prices are…
Is a Major Commodity Shift in Motion? Economy Sees Signs of Inflation
A major shift in the commodity environment might be in motion. Strength in energy prices has not only surprised the trade, it has also strengthened fund interest in the commodities. A potential massive inflation development could come…
Bullish Forces in Commodities Capable of Counteracting Geopolitical Headwinds
Last week was probably the most epic geopolitical week in years. It featured yet another iteration of US/Chinese trade barbs, an escalation of Russian/US military tensions, and a missile attack by Yemeni rebels against Saudi Arabia. Countervailing these headwinds were…
Trade War Threats to Cause Short Term Pain in Commodities While Gold & Treasuries May Find Support
While the trade rift between the US and China could eventually be settled peacefully, it could be very difficult to avoid further escalation in the coming week. As of last Friday, it appeared as though the trade war threats were extended beyond the governmental level and to the populace in China, with calls to “buy Chinese” and boycott US products. China also threatened to increase…
Improved Expectations in Metals and Treasuries Contrasts Potential Volatility in Physical Commodities
With US scheduled data into the end of March/end of quarter coming in positive and the trade facing the March nonfarm payroll report at the end of this week, it is possible that US economic expectations will be improved and markets like Treasuries, equities, copper, silver, platinum and palladium will resume the trends in place from the end of February. However, physical commodities…