Soft Commodities Higher On Midwest Harvest Fears
GoldMoney News Desk | Jul 10, 2012 08:25AM ET
Gold is stuck in a channel between $1,575 and $1,600, with consolidation remaining the name of the game. Bulls were encouraged somewhat yesterday by talk from the presidents of the San Francisco, Chicago and Boston Federal Reserve banks, all of whom underscored their support for dovish Fed policies. The dollar came under selling pressure following this news, while precious metals recorded modest gains. Interestingly, Jesse’s Café notes that the St Louis Fed has started tracking London gold prices as part of its Federal Reserve Economic Data (FRED) series. So officialdom is not quite as uninterested in the yellow metal as they would have you believe.
These comments from Fed officials partially offset bearish news from elsewhere in the world. Spanish interest rates once again spiked higher, while falling Japanese machine tool orders and pessimistic growth forecasts for Vietnam and Hong Kong also added to the sense of pessimism about Asia. Chinese inflation fell 0.6% May to June, the biggest drop in two years, though this will allow the People’s Bank more wiggle room in terms of stimulus efforts.
Back in America meanwhile, the Fed’s efforts to boost inflation are receiving support from a non-conventional source: in the form of the vicious drought that has recently gripped the lower sections of the Midwestern corn belt. WSJ reports that corn prices are just cents away from the nominal record of $7.9975 a bushel reached in June 2011, when prices were high owing to worries about floods. Soybeans hit a record high of $16.65 a bushel yesterday. Keep on eye on food prices over the coming months.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.