Oil Steadies, Gold Declines
2022.10.14 08:49
Oil stabilizing
A strong rebound in oil prices on Thursday coincided with the broader risk reversal in the markets, taking back towards $95 a barrel. This sits right in the middle of the range that Brent may establish itself in now, between $90 and $100. This has been touted as the potential target range for OPEC+ and may prove to be something that consuming countries can just about tolerate.
Although with midterms coming up, another SPR release can’t be ruled out in the short term. The global growth outlook remains a major downside risk, and with labor markets remaining tight and inflation stubborn, further downgrades could be on the cards.
Gold on the decline after a whipsaw session
prices whipsawed alongside other assets on Thursday but are trading around half a percent lower this morning. The data was terrible for the yellow metal as it cemented a 75 basis point hike from the Fed next month.
Not just that, with inflation seemingly so stubborn, it may need to go further than markets previously anticipated. That doesn’t bode well for gold in the near term. Yesterday’s lows around $1,640 could soon be tested again, with the late-September lows the next test.
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