03.07.2015 - The price of oil continued to decline

The price of gold showed a sharp decline yesterday after the release of statistics on the US labor market, but the growth has resumed and the price returned to the levels near 1170 dollars per troy ounce. We recall that the statistics on unemployment is the key factor that affects the decision of the Fed on raising interest rates, which was negatively displayed on the value of gold. According to yesterday's report, the US unemployment rate reached its lowest level since 2008 - 5.3%, but the number of new jobs was less than analysts' forecasts and reached 224 thousand. Today, volatility will be low due to the holiday in the US. On Monday is expected the increase in investors’ activity after the referendum on the austerity measures in Greece, which may lead to the country’s exit from the Eurozone and increased demand for defensive assets. We forecast growth of gold prices in the medium term, but we can see its further decline in the near future.

The price of Light Sweet crude oil has continued to decline due to the ambiguous statistics on the labor market in the US, where the number of new jobs grew less than the forecast. As a result, the price has reached the target level of 57 dollars per barrel and continued to decline. The main factors that put pressure on the price of oil remains oversupply of oil in OPEC production growth, reduction of oil imports in China and waiting for the lifting of sanctions against Iran that could be done till July 7. We maintain a medium-term negative outlook on the oil with the potential reduction to 50-52 dollars per barrel.

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