What’s next? – GOLD, OIL 02.05.17

Gold prices were higher in early trading on Tuesday as geopolitical concerns over the Korean peninsula continued to weigh on market sentiment.
On the Comex division of the New York Mercantile Exchange, gold for June delivery edged up 0.18 percent to trade at $1257.70 a troy ounce as of 05:35 GMT.
The US dollar index, which measures the greenback against a basket of six major currencies, traded at 98.90, falling 0.03 percent. As gold is a dollar-denominated commodity, a softer greenback makes the metal more attractive for investors holding foreign currency.
The latest minutes from the Bank of Japan policy meeting were released this morning. The document showed that policymakers agreed to pay more attention to consumer prices. According to the report, even if CPI reaches the 2 percent goal set by the regulator, quantitative easing will not be reduced by that fact.
In economic news, China’s Caixin manufacturing PMI established at 50.3 in April, against expectations for 51.2. This survey is mainly directed to small and medium-size companies.
On Monday, the precious metal settled lower as US congressional leaders reached a deal to keep the government funded for another five months, preventing a shutdown this week.
Later in the day, investors will be looking at manufacturing data in Germany, Great Britain and the Eurozone, along with the unemployment rate from the late one.

OIL
Oil prices edged down in Asian hours on Tuesday as Chinese manufacturing data came in weaker than expected, while traders shifted their attention to inventories in the United States.
US West Texas Intermediate oil futures traded at $48.66 a barrel on the New York Mercantile Exchange, down 0.37 percent from its prior close. The international Brent crude oil futures fell 0.27 percent to trade at $51.38 a barrel as of 06:40 GMT.
The Caixin manufacturing PMI for April dropped to 50.3, although analysts expected no changes from a previous 51.2. The survey is centered on small and mid-sized companies.
Investors are now focusing on inventory data from the American Petroleum Institute, which is set to be released late in the afternoon. The report on crude and refined products stockpiles will provide a better understanding on how US shale producers are reacting to OPEC-led efforts.
Official data from the US Energy Information Administration is due tomorrow, with analysts pointing at a 2.160 million barrels decrease in crude inventories.
The Organization of the Petroleum Exporting Countries (OPEC) and other independent producers, such as Russia, agreed to shred 1.8 million barrels per day from global oil output in the first six months of 2017 as a way to prompt up prices and rebalance crude supply levels.
On May 25, OPEC members will gather in Vienna to take a final decision on whether extend or not the output cuts beyond June. Saudi Arabia and Kuwait have already expressed their support to the idea, but Russia remains on a shady position over the matter.
Overnight, oil benchmarks settled to the downside after Libya’s crude production rebounded to its highest level in three years, fueling fears for an oil overhang.

Fort Financial Services