Written Commentary
Ag Market View for Dec 13.24
December 13, 2024
GOLD
December gold futures advanced to the $2625 dollar level after the U.S. October consumer price index report was released. Traders were relieved that the consumer price index report did not show a larger increase.
The October producer price index and weekly jobless claims reports will be released on Thursday, and retail sales figures will be reported on Friday. Despite the recent uptick, gold remains near a two-month low, as expectations grow that the Federal Reserve may be slow to lower its fed funds rate in 2025, partly due to president-elect Trump’s fiscal policies.
The World Gold Council revealed that global gold ETFs saw outflows of approximately $809 million (12 tons) in early November, primarily driven by North American withdrawals, although Asian inflows provided some offset.
SILVER
After hitting new lows for the move yesterday, December silver futures are higher today. Futures were quick to advance when the October U.S. consumer price index report was released.
Silver prices face ongoing pressure from a stronger U.S. dollar. Some of the recent pressure can be linked to expectations of fiscal expansion and inflationary policies under the incoming Trump administration. These policies could limit the Fed’s ability to reduce borrowing costs, which would further weigh on silver. Silver is also under pressure due to its significant use in electrification, especially in solar panels, with the potential for higher tariffs under Trump adding further uncertainty.
COPPER
December copper futures declined to the lowest level since September 11 as concerns over demand in China and a strengthening U.S. dollar weighed on commodity markets.
Also, there are worries about the possibility of additional tariffs on China under a second Trump administration, which have added to the uncertainty surrounding demand.
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