Demand Is Rising For NGAS, Strong Supply Prospects For Cotton, Investors Turn To The US Dollar As An Inflation Hedge Instead Of Gold
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Summary:
- Noord Stream pipeline maintenance causing supply concerns.
- Decreased cotton consumption from top clothing makers.
- Gold futures touching near 9 month lows.
NGas Prices driven by increased demand
Natural Gas futures are recovering from a 3 month low experienced earlier in July, supported by strong international and domestic demand. As the weather gets hotter and demand for cooling increases, the demand for NGas strengthens whilst routine maintenance on the Noord Stream pipeline are contributing to driving prices higher.
NGAS Aug’22 Futures Price Chart
Strong Cotton supply prospects
Cotton prices have been falling in the wake of lower demand prospects as China adopted new Covid-19 curbs adding to global shutdown concerns already in place which have been caused by aggressive monetary policy tightening by major central banks. At the same time, USDA cut the world production expectations for cotton by 450,000 bails for June due to decreased consumption from Bangladesh and Mexico. Cotton supplies are looking strong going forward.
Cotton Oct ‘22 Futures Price Chart
Gold futures
Gold futures are hovering around 9-month lows on Tuesday in the wake of investors choosing the US Dollar as a hedge against inflation and risks around a recession over gold. Expectations that the Federal Reserve will continue to tighten monetary policy by aggressively raising interest rates have also put pressure on gold prices as a stronger than expected US jobs report and upcoming US inflation data could bolster the Feds plans.
Gold Aug ‘22 Future Price Chart
Sources: finance.yahoo.com, tradingeconomics.com
