28.10.2014 - Volatility on commodity markets has fallen greatly
The price of gold fell slightly, but continues to consolidate near the level of 1230 dollars per troy ounce. Demand from investors has dropped significantly last week in connection with the growth of the stock markets, but in case of another index fall, we can see a growing interest in defensive assets. Gold consumption in Asia has traditionally grown in Q4 due to holidays in the region. It is worth noting that investors are in no hurry to build up positions before the US Federal Reserve statement on monetary policy, which will affect the value of the dollar. The course of trading today will be affected by the data on orders durable goods (12:30 GMT) and the index of consumer confidence in the US (14:00 GMT). We maintain a positive medium-term outlook for gold.
The price of Light Sweet crude oil fell on weak data on the index of business confidence in Germany to 103.2 in October which is worse than analysts' forecasts. Analysts expect OPEC countries meeting on November 27 where will be reviewing the crude oil supply quotas. At the same time, Iran has stated its intention to increase the volume of oil refining, from 1.8 million barrels to 3 million barrels per day. At the moment, we see growth in supply due to increased deliveries from Libya and Iraq and weak demand in Europe and Asia. US oil inventories continue to rise. On Thursday will be published data on US GDP, which may lead to higher oil prices. We maintain a medium-term negative outlook on oil with a potential decrease by 6-8%.