Comex Gold rose more than 1% during the previous week (February 19-23), tracking a decline in the greenback and US benchmark treasury yields on Friday amid uncertainty regarding the Fed policy outlook. Minutes from the January FOMC meeting showed most officials remained more worried about the risk of cutting interest rates too soon than keeping them high for too long and damaging the economy, and the same tone was echoed in Fed speeches.
For the week, US PCE price index, second estimate of US Q4 GDP, ISM Manufacturing PMI and a slew of Fed official’s speeches will be in spotlight. PCE price index is expected to see an uptick in January, which might be a headwind for gold prices.
WTI Crude oil futures snapped two consecutive weekly gains and declined by 2.5% during the previous week, amid demand concerns from higher rates and China growth concerns. Risk sentiments remain limited ahead of the US PCE inflation data. Market outlooks will come from International Energy Week in London this week, a major industry gathering.
Ongoing negotiations in the Israel-Hamas war and possible hostage deal along with lack of supply disruptions weighs on the risk premium. Elsewhere, OPEC is expected to extend the output cuts into next quarter, shared market trend by Ravindra Rao, Head – Commodity Research at Kotak Securities!