Silver prices are 12% up in November, brent crude down on concerns around the reopening of China, corn futures falling

Summary:

• Silver prices are nearly 12% higher in November.
• Investors remained on edge due to concerns over a possible reopening of China.
• Corn futures had their largest monthly decline on indications of ample supply.

Silver futures up in November

When compared to the five-month high of $21.7, silver futures were trading near $22 per ounce as speculators continued to predict how much the Federal Reserve will increase interest rates at its upcoming meetings. Despite the October inflation reading being lower than anticipated, Fed policymakers insisted that the central bank is continuing to fight inflation. Even so, silver prices are nearly 12% higher in November as wagers on the Federal Reserve's target rate were reduced by data confirming the trend of reducing inflation. In December, the Fed is expected to increase its target funds rate by 50 basis points (bps), slowing from the four consecutive 75-bps rate increases made since June. Although bullion is frequently employed as an inflation hedge, its attraction is diminished by increased interest rates as they increase the opportunity cost to store non-interest-bearing assets.

✕ Silver futures price chart

Brent crude oil falling in the wake of relaxed COVID-19 measures in China

Brent crude futures were trading at roughly $95 per barrel, a sharp decline from their daily highs of $97 per barrel as investors remained on edge due to a strong currency and concerns over a possible reopening of China. China's National Health Commission recently relaxed certain coronavirus-related restrictions on the top oil import in the world, but an increase in coronavirus cases over the weekend delayed plans for an immediate and thorough reopening. After OPEC+ agreed to limit output by 2 million barrels per day in November, the potential of even tighter supplies continued to support prices. At the same time, a ban on Russian oil by the European Union is scheduled to go into effect in December.

✕ Brent crude futures price chart

Corn weighed down by strong supply prospects

Chicago maize futures experienced their largest monthly decline on indications of ample supply. As poor Chinese demand encourages soybean farmers to grow alternative crops, USDA predictions point to increased corn seedlings and plantation areas for the upcoming marketing year. Expectations for the supply increased as well after Russia declared it will rejoin the UN-mediated agreement that ensures the security of grain exports from Ukrainian Black Sea ports. Moscow's decision to withdraw from the deal at the end of October over security considerations was overturned by the action, allaying concerns about a worldwide food crisis. The restoration of trade not only facilitates exports but also allows Ukraine to release significant storage space in silos as the harvest for the 2022–2023 marketing year is underway.

✕ Corn futures price chart

Sources: tradingeconomics.com, finance.yahoo.com