NGAS Futures Closed At Two Month Lows, Cotton Prices Falling, Global Wave Of Monetary Policy Tightening Puts Gold Prices under Pressure
Aa
Share
Summary:
- Natural gas futures prices are dropping.
- As the dollar strengthens and global monetary policy tightening continues, the price of gold remains under pressure.
- Cotton demand expected to decrease as supplies are set to increase.
NGAS futures closed at two month lows
Natural gas futures closed at their lowest level in two months in the wake of rising domestic inventories. Freeport LNG indicated that it did not expect the terminal to return to full operations until late 2022, however, partial operations could return within three months. The recent explosion at one of the largest US natural gas export terminals is keeping the US supplies, despite ever rising international demand, which is releasing the domestic price pressure.
NGAS Jul ‘22 Futures Price Chart
Gold prices falling amidst a wave of monetary policy tightening
The price of gold remains under pressure from rising treasury yields and a strong US Dollar. Gold prices fell around 2% last week amidst a global wave of monetary tightening which aimed at bringing inflation down, the wave was led by the Federal Reserve's 75 basis point hike. The gold prices fell due to the fact that investors tend to shy away from the non-yielding metal as interest rates rise.
Gold Aug ‘22 Futures Price Chart
Cotton demand weakens as supply rises
Cotton futures were trading at almost 4 week lows on prospects of higher supplies and weaker demand. Demand for cotton is seemingly weakening across the world as inflationary pressures resume and as the world’s largest cotton consumer, China, re-enters into Covid-19 lockdowns. In addition, the production is due to increase in both Egypt and other West African countries, whilst demand is expected to drop from Vietnam, Mexico and Bangladesh.
Cotton Oct ‘22 Futures Price Chart
Sources: finance.yahoo.com, tradingeconomics.com
