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Gold prices steady as traders evaluate further rate cuts. Set for third monthly increase
Gold prices were stable above $4,000 per ounce as traders assessed the uncertainty surrounding another rate cut this year by the U.S. Federal Reserve. However, the metal was poised to make a third consecutive monthly gain. At 9:32 am, spot gold was unchanged at $4.023.44 an ounce. ET (1332 GMT), the price of gold had fallen to $3,988.37 in earlier part of the session. Prices are on track to increase by 4% in the month of April. U.S. Gold Futures for December Delivery were up 0.5% to $4,035.30 an ounce. Dollar index was near its three-month-high, causing greenback bullion to be more expensive for holders of other currencies. Many traders were waiting to re-allocate their gold holdings. Phillip Streible is the chief market strategist for Blue Line Futures. He believes that they did this below $4,000. The U.S. Federal Reserve cut interest rates on Tuesday, but the hawkish comments of Chair Jerome Powell caused traders to reduce their bets for another rate cut in December. The CME FedWatch tool shows that the markets now price a 65% probability of a rate cut in December. This is down from 90% earlier in this week. When interest rates rise, gold loses its appeal as it is not a yielding asset. This metal is up 53% in the past year and reached a new record high on October 20, reaching $4,381.21. Morgan Stanley said on Friday that it still sees gold as a positive investment due to interest rate reductions, ETF purchases, central bank purchases, and the ongoing uncertainty in the economy. The bank predicts that gold will average $4,300 during the first half 2026. Donald Trump, the U.S. president, said that he would reduce tariffs against China from 57% to 47% in exchange for Beijing crackingdown on illegal fentanyl trafficking. He also promised to resume U.S. purchases of soybeans and keep rare earth exports flowing. Palladium rose 1.4% to 1,464.75, while platinum fell 1.7% to $1583.80. (Reporting and editing by Noel John in Bengalur, Pablo Sinha at the New York Times)
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Canada's GDP contracted in August and could avoid a third-quarter recession
Data showed that the Canadian GDP shrank in August, despite a consensus estimate for flat growth. An advance estimate indicated the economy could avoid a recession by the third quarter. Statista Canada reported that the economy contracted by 0.3% during August, following a 0.3% increase in July, which was revised upwards. This effectively negated any growth in the current third quarter. This was the fourth contraction in five month and was primarily due to a decline in the growth of both the goods and services sectors. A preliminary indicator indicated that the monthly GDP was likely to grow by 0.1% in the month of September, bringing the annualized growth for the third quarter up to 0.4%. The estimate may not be accurate. StatsCan publishes the quarterly annualized estimate based on data on industrial production, while StatsCan releases quarterly annualized GDP based solely on income and expenses. Canada can avoid recession if the economy grows in September. A recession is defined as two consecutive quarterly contractions. Canada's GDP shrank by 1.6% in the second quarter as tariffs and trade uncertainty slowed exports. Michael Davenport is a Senior Economist with Oxford Economics. He said that the Canadian economy was on the brink of a major recession. Some economists believe that the federal budget next week could boost spending and demand, and grow the economy. After the release of the data, the Canadian dollar continued to weaken and traded at 1.4022 U.S. dollars or 71.32 U.S. Cents. The yields on government bonds with a two-year maturity fell by 1.5 basis points, to 2.397%. Data showed that the manufacturing sector, which has been hardest hit by U.S. Tariffs and represents almost a 10th of GDP, contracted 0.5% in August. The largest drop was in the mining, oil and gas extraction and quarrying industries, which decreased by 0.7%. This was primarily because of a 1.2% decline in metal ore and a 5.0% drop in coal mining. In the services sector the biggest contractions occurred in the transportation and warehouse sectors, partly due to an airline strike. The decline in this sector was partially offset by growth in real estate, retail trade, and rental and leasing.
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Acerinox praises recent EU actions and urges adoption
The head of Spanish steelmaker Acerinox, who is also the CEO of the European Commission, praised the recently announced steel import quotas on Friday but stated that the company was working hard to ensure the measures are adopted sooner. On a conference call with analysts, Chief Executive Officer Bernardo Velazquez stated that the company is pushing to speed up the process. He suggested the measures could be implemented as soon as April 2026 before the current ones expire on June 30. Velazquez stated that "we are very close to getting the protection we have been dreaming of and asking for over the years." He was referring to U.S. steel tariffs at 50% and EU import quotas. Velazquez said that the measures would put Acerinox in a position of equal footing with non-European rivals. Steelmaker has been adamant about what it believes to be global overcapacity, and the pressure of cheap Asian imports that underprices European firms. "MORE REGIONAL FURTURE" Acerinox missed its third-quarter earnings estimates, but Chief Corporate Office Miguel Ferrandis stated that the company was on the verge of recovery as tariffs are driving up stainless steel prices in America. Ferrandis said that the "green shoots", or signs of recovery in Europe were not yet visible, particularly as Asian players increased exports to prepare for EU measures, and imports grew 36% between January and August. Velazquez said that the company is preparing to have a more regional future in response to changes in trade policies. He gave the example of reducing the reliance on exports in South Africa and increasing local sales. In the past, (the output was) 70% local and 30% export. Velazquez stated that the goal is to have more than 60% local and 40% export. (Reporting and editing by Anna Pruchnicka; Javi West Larranaga)
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El Salvador's 'plague of water lettuce' threatens livelihoods of thousands
Alberto Castillo abandoned a boat at the shores Lake Suchitlan in July. Water lettuce had overtaken the largest lake in El Salvador, and he could no longer take tourists or fish around it. The invasive species has affected thousands of families who live near the lake. Satellite images taken in early October reveal that the plant has covered nearly the entire lake, which is 135 square kilometers (52 square miles). Fundesyram in El Salvador, which is cleaning the reservoir, estimates 80% of it is affected. The reservoir was built in the 1970s for the country's main hydroelectric power station. The spread of the plant has been accelerated by pollution, rain, and nutrients flowing from different tributaries. The wavy lettuce leaves have spread, forming a dense mat which blocks oxygen entering the water. This kills fish, submerged plants and makes it difficult for boats to navigate the water. According to the data of the confederation artisanal fisheries cooperatives, the spread of the species has forced 3,000 fishermen from the lake. The local economy has also suffered a loss of at least $1.3million. Due to a decline in tourism, restaurants near the lake have reduced staff. Locals call water lettuce "the plague." Hundreds of residents, soldiers and government workers are cleaning the lake to remove the lettuce which is not edible for humans. The lettuce invasion continues despite the fact that some areas have been cleared and are cordoned off with steel cable to prevent it from returning. Castillo stated that "we don't have tools to stop an epidemic as large as this plant." Castillo said, "We cannot fight nature."
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Angola's diamond production reached 10.7 million carats between January and September
Angola’s rough diamond production in the nine-month period ending September reached 10,7 million carats, said a government official on Friday. The country is aiming to achieve another record haul of rough diamonds this year. In 2024, the southwest African nation produced a record of 14 million carats rough diamonds, ranking it third in terms of production behind Botswana and Russia. It aims to produce 14.8 million carats in 2018. Janio Correa Victor, the secretary of state for minerals resources, said that output was 23,2% higher at half-year but did not give comparative figures for 2024's first nine months. Victor said that the higher output is due to the operational stability of the Catoca Mining Company as well as the Luele Mining Company. Both companies are owned jointly by the state-owned Angolan diamond company Endiama, and Taadeen Investment LLC a subsidiary from Oman's sovereign fund. In 2024, the Omani company replaced Russian miner Alrosa in Angola as a partner in state owned diamond projects after Alrosa had been sanctioned following Moscow's invasion in Ukraine two years before. Victor stated that the value of Angola’s rough diamond exports fell 14% in the past nine months despite the fact that export volumes had doubled. This was due to the fall in prices for precious stones. He said that this was due to the competition from synthetic diamonds combined with global economic uncertainty, trade tariffs imposed on the United States and the stagnation in the Chinese market after the COVID-19 epidemic. Angola has increased its diamond production since 2002, when a civil conflict ended. Before 2002, Angola was one of three major sources of conflict-diamonds, along with the Democratic Republic of Congo, and Sierra Leone. Angola bid on a majority share of De Beers. The company was put up for sale after restructuring by Anglo American. This could lead to a conflict with Botswana who also wants control over the giant diamond mining company.
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Copper continues to retreat due to weak Chinese factory data and a stronger dollar
The copper price continued to fall on Friday. Weak industrial data from China, the world's largest metals consumer, coupled with a strong dollar and profit taking following a rally that reached a record high, all contributed to its decline. The London Metal Exchange's three-month copper was down slightly at $10,915 a metric ton, in open-outcry official trading. This is the second consecutive day of losses, after reaching a record high of $11,200 on Wednesday. LME copper is on track to achieve its third consecutive monthly gain after gaining 5.7% this month. The data showed that China's factories shrank in October for the seventh consecutive month, due to a decline in export orders. This was due to the fact that months of putting in extra work in order beat U.S. Tariff threats had finally worn off. Ewa Mnthey, commodities analyst at ING, said that the China data released today has affected the base metals market sentiment. She added that "while near-term indicators of demand remain mixed, disruptions in supply will keep prices at a level around $10,000 per ton." Copper will need to be in high demand, particularly from China, to continue its upward trend. The Shanghai Futures Exchange's most traded copper contract fell 1.7%, to 87.010 yuan (12,215.36) per ton. The copper contract was also set to rise 4.8% for the third consecutive month. As prices have risen, many Chinese buyers have remained on the sidelines. Yangshan Copper Premium The price of copper, which is based on the demand for imported copper into China, dropped by 28% in the last month, to $36 per ton. A slightly stronger dollar index also pressed the market, hovering around a three-month high touched on Thursday. A firmer dollar makes greenback-denominated assets more expensive to holders of other currencies. Marex said in a recent note that the copper price decline could continue. "Caution! We note that some indicators suggest that additional corrective action may be needed." LME aluminium prices rose by 0.6% to $2,880 per ton in official activity, despite a rise in LME inventories A 102,275 ton inflow into Malaysian warehouses has caused the increase to be a fifth. Other metals include LME Nickel, which rose 0.1% to $16,240 per ton. Zinc gained 0.6%, to $3,055, while tin increased 1.3%, to $36,265; and lead fell 0.2%, to $2,018. Click here to see the latest news in metals.
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The dollar and OPEC+ supply are weighing on oil prices, which is expected to drop for a third consecutive month.
The oil price was flat on Friday but headed for a third monthly decline as a strong dollar, weak China's data, and increased supply from major producers worldwide weighed. Brent crude futures recovered some of their earlier losses and were now up 29 cents or 0.5% at $65.29 per barrel at 1303 GMT. U.S. West Texas intermediate crude was up 53 cents or 0.9% at $61.10 per barrel. Dollar-denominated goods such as oil are more expensive because the U.S. currency is near its three-month-highs. Sources said that Saudi Arabia may cut its crude oil price in December for Asian buyers down to multi-month lows. The price of oil also fell after an official survey revealed that China's manufacturing activity had declined for the seventh consecutive month in October. Brent and WTI will fall by 2.6% and 2% respectively in October, as the Organization of the Petroleum Exporting Countries (OPEC) and other major producers increase their output. The increased supply will also help to cushion the impact on Russian oil exports, which are currently restricted by Western sanctions. These include China and India. Brent is expected to average $67.99 a barrel by 2025, which is about 38 cents higher than last month's estimate. WTI will average $64.83, which is slightly higher than September's estimate. People familiar with the discussions said that OPEC+ was leaning toward a modest increase in output for December. The group will meet on Sunday. The Joint Organizations Data Initiative reported that the top crude exporter Saudi Arabia's exports reached a six-month record of 6,407 million bpd during August. The U.S. Energy Information Administration also reported a record production of 13,6 million bpd in the last week. Donald Trump, the U.S. president, said that China had agreed to start the process of buying U.S. Energy. He added that an extremely large transaction could take place regarding the purchase of oil from Alaska. Analysts are unsure whether the U.S. China trade agreement will increase Chinese demand for U.S. Energy. (Florence Tan contributed additional reporting; Susan Fenton edited the article)
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MORNING BID AMERICAS TEMPLATE
What Mike Dolan, the ROI team and I are looking forward to reading, watching and listening to this weekend. Hello Morning Bid readers! Wall Street was spooked Thursday as Microsoft and Meta saw their shares fall due to concerns over the AI capex spree. The big news this week was that chip giant Nvidia became the first company whose market cap exceeded $5 trillion after only hitting $4 trillion three months earlier. It looks like Halloween will be more of a "treat" rather than a "trick," with U.S. equity prices rising before Friday's bell. We began the week with the news that there would be a likely agreement between U.S. president Donald Trump and his Chinese equivalent Xi Jinping. We saw that happen on Thursday, after a meeting that the U.S. President described as "12 out 10". They reached a deal which included a reduction of U.S. duties on Chinese products and a postponement of China's restrictions on rare earths. Jamie McGeever of ROI Markets warns not to get too excited. The U.S. China story is nothing new. The Federal Reserve Chair Jay Powell was the source of another big story this week. The Fed's Wednesday decision to reduce interest rates by 25 basis point was widely anticipated, but the Chair indicated that a cut in December was not a foregone conclusion. The Fed may have been recognizing that interest rates cuts are not the best way to help an economy with labor shortages. Mike Dolan, editor-at-large at ROI magazine, believes that the Fed's hawkish stance has given the U.S. Dollar a boost. It is expected to gain 2% this month. This will not go over well with Trump's administration. OPEC is meeting this Sunday, and it's expected that they will announce another increase in output. Saudi Arabia, OPEC’s de facto leader appears to be stuck between Donald Trump and a rock, argues ROI's Ron Bousso. The U.S. President's latest oil sanction against Russia forces Riyadh's to weigh competing geopolitical priorities and economic priorities. How effective have sanctions against Russia been? Clyde Russell, Asia Commodities columnist for ROI Asia, addressed this question in a recent article. He argued that the answer depends on how you measure success. Gavin Maguire, ROI Energy Transition columnist this week, discussed China's electric car output and exports after a major policy pivot. In the metals market, copper was again in the spotlight as the London Metal Exchange hit a nominal high of 11,200 dollars per metric tonne on Wednesday. Check out what the ROI team recommends you read, watch, and listen to as we enter the weekend. Stay informed and prepared for the coming week. Please contact me via This weekend we are reading... Here's how a New Zealand-based small insurer is an important link in the dark network responsible for shipping Iranian oil and Russian oil. Anne Krueger, former IMF and World Bank official, wrote a column this week for Project Syndicate that makes a strong case for - replacing the weakened WTO. She supports the Canadian Prime Minister Mark Carney's push. The latest report by the shows how China, India, and Indonesia -- three of the largest coal consumers in the world -- could all reach peak power sector emission levels by 2030. This week the copper prices in London reached a new high. Here's an overview of the current market. Here's everything you always wanted to know but were afraid to ask about copper. Listening to... I recommend it in general but particularly the most recent episode where the Russian Bureau Chief and commodities editor discuss how the energy war between Russia and Ukraine has intensified. They talk about its impact on both the Russian economy and the global energy markets. Sign up for the newsletter to receive Morning Bid every morning in your email. Subscribe to the Morning Bid newsletter Website You can find us on LinkedIn. The opinions expressed are solely those of their authors. These opinions do not represent the views of News. News is bound by the Trust Principles to maintain integrity, independence and freedom from bias. (By Anna Szymanski)
Russian rouble deteriorates, anticipating support from tax payments
The Russian rouble continued to compromise versus all major currencies on Tuesday, remaining at its most affordable against the Chinese yuan in nearly a year as it expects support from currency sales by exporting companies to make their tax payments.
By 0800 GMT, the rouble was down 1.56% at 92.90 versus the dollar and by 1.69% at 13.07 versus the yuan, LSEG data revealed.
The rouble was down 0.41% at 13.20 against the yuan in trade on the Moscow Stock Exchange.
The rouble's weakening is echoing the oil costs decline that began in July, Alor analysts said. Oil costs have been steadily decreasing given that July 3 but started rising again on Sept. 10.
The analysts stressed that the rouble was about to get assistance from forex sales by exporting business to make their tax payments at the end of the month.
However, we do not anticipate a considerable conditioning of the rouble, they included
Trading in major currencies in Russia has moved to the over-the-counter (OTC) market, obscuring rate information, since Western sanctions on the Moscow Exchange and its cleaning representative, the National Clearing Centre, were presented on June 12.
One-day rouble-dollar futures, which trade on the Moscow Exchange and are a guide for OTC market rates, were flat at 92.81. The reserve bank's main exchange rate, which it determines using OTC information, was set at 92.92 to the dollar.
The rouble was down 2.16% at 103.82 against the euro , LSEG information revealed.
Brent crude oil, an international standard for Russia's. primary export, was up 1.22% at $74.81 on news of financial stimulus. from leading importer China and issues that tensions in the Middle. East could strike local supply.
(source: Reuters)