(XAUUSD) Gold Struggles To Keep Up With The Strengthening US Dollar, Concerns Around Demand For Crude Oil, Concerns Around Copper Supply May Ease
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Summary:
- Investors are turning away from gold as they search for safer assets - what could be safer than gold?
- China's lockdowns offsetting supply concerns for Crude Oil.
- Concerns around Copper supply may ease as Western countries turn to Africa for supply.
Gold prices facing further downward pressure
The past week the price of gold has been facing downward pressure, this comes as the dollar continues to rally in the wake of the hawkish Federal Reserve. As the dollar becomes stronger, investors are shying away from the Gold futures and turning to the U.S government which offers a higher return.
The U.S CPI report indicated that inflation is still a concern for the Fed and is still high, supporting the Feds plan to continue aggressively tightening interest rates to fight inflation.
Gold Jun ‘22 Futures Price Chart
Crude oil futures remain in the green, for now.
Earlier on in the trading week the price of Crude Oil futures dipped. On Monday the market experienced a large downward trend, and the price of Crude Oil followed the market, since then it has been showing steady recovery.
There are still concerns around demand and supply for this commodity, as the European Union clamps down on Russian imports. However, there are also concerns around demand with the lockdowns in China which may offset the supply concerns.
Crude Oil jun ‘22 Futures Price Chart
As Western countries are looking to Africa for Copper, prices may fall.
Copper prices have been falling the past week, the price of most commodities followed the market trend this week, on Monday the market experienced a large downward trend and the price of copper futures did too. Since then the price has struggled to fully recover.
With western countries turning to Africa for their Copper supplies, the concerns around supply are likely easing, another factor that could push the prices down further.
Copper Jul ‘22 Futures Price Chart
Sources: finance.yahoo.com
