The price of gold continued to decline amid growing speculations about the Fed raising interest rates in June of this year due to the improving situation on the labor market of the country. Tightening of monetary policy will negatively affect the demand for gold. On the other hand, the decline in industrial production in China, which is the largest consumer of gold in the world negatively displayed on the mood of traders. At the same time, it is worth noting that Chinese traders intensified purchases against the backdrop of the attractiveness of current price levels. We expect the resumption of growth of quotations of gold in the near future and note the limited potential for further reduction.
The price of Light Sweet crude oil continued to decline amid rising US oil inventories to record levels. Thus, crude oil inventories rose in the US for the week by 4.5 million barrels, in line with analysts' forecasts. The excess supply of oil on the market is a concern on the reduction of capacity for oil storage. We recall that oil production in the US and around the world continue to grow, which is the main factor that puts pressure on oil prices. In the near future might be a slight correction. We maintain our medium-term negative outlook and recommend holding short positions.