Gold prices fall in Asia on strong dollar, political risks eyed - Sean Seshadri

Gold prices dipped in Asia on Friday with a stronger dollar weighing on demand, but support coming on political risks, including a meeting next week in Florida between President Donald Trump and China's President Xi Jinping as well as elections in France and chances of a far-right government.

Gold for April delivery on the Comex division of the New York Mercantile Exchange fell 0.40% to 1,240.00 a troy ounce. Copper futures fell 0.30% to $2.668 a pound.

China's semi-official manufacturing PMI rose to 51.8, the China Federation of Logistics & Purchasing (CFLP) said Friday, beating the expected 51.6 level and releasing the figures one day ahead of the normal first of the month release and ahead of the Caixin PMI figures.

Earlier in Japan, household spending for February slumped 3.8% year-on-year, compared to a 1.7% decline seen. On a monthly basis however it rose 2.5%, beating the expected 0.4% rise.

Separately, national core CPI fell 0.2% for February year-on-year as expected, while unemployment dipped to 2.8% from 3.0%. Provisional industrial production for February rose 2.0% month-on-month, beating the expected 1.2% increase.

The dollar rose to a nine-day high against a basket of currencies on Thursday, easing slightly to around 100.40 on Friday in Asia. Gold is priced in greenbacks, making it potentially more expensive for holders of other currencies.

Overnight, gold prices traded lower on Thursday, as a push in the dollar weighed on the yellow metal, after the release of upbeat economic data and continued rate hike chatter from several Fed officials.

Gold prices fell to session lows, and on track to end the week in negative, after the dollar swooped to a nine-day high, buoyed by an upward revision in GDP data and hawkish comments from several Fed officials.

The Commerce Department earlier reported that U.S. gross domestic product grew faster than previously reported in the fourth quarter.

Cleveland Federal Reserve reiterated her hawkish view concerning interest rate hikes Thursday, as she said that “further removal of accommodation via increases in the fed funds rate will be needed” should economic conditions “evolve as anticipated”.

Fed President John Williams, tapered some of his bullish rhetoric on the U.S. economy, after he said even though the economy shows “consistent” and “encouraging” signs, “housing still isn’t quite back”.

Economic uncertainty in Europe, as the date of the French presidential election draws closer and the start of Britain’s departure from the European Union, have largely offset the negative impact a stronger greenback has on dollar denominated assets such as gold.

Meanwhile, cash crunches in India due to the government’s recent demonetization will likely act as a temporary headwind for gold prices in the coming months, according to a report from FocusEconomics Consensus Forecast – Commodities.

Oil falls on rising U.S. drilling, uncertainty of OPEC-led cut extension - Sean Seshadri

Oil prices fell on Monday, pulled down by rising U.S. drilling activity and by doubts whether an OPEC-led production cut initially due to end in mid-2017 would be extended.

Benchmark Brent crude futures (LCOc1) fell by 37 cents, or 0.73 percent, from their last close to $50.43 per barrel by 0626 GMT.

In the United States, West Texas Intermediate (WTI) crude futures (CLc1) were down 45 cents, or 0.94 percent, at $47.52 a barrel.

Traders said that prices were pulled down by rising U.S. drilling and production as well as over uncertainty whether the Organization of the Petroleum Exporting Countries (OPEC) and other producers, who met in Kuwait over the weekend, would extend output cuts beyond the middle of the year.

"There is currently no shortage of crude oil...the fact that shale oil is going to burgeon is also painfully evident," said Sukrit Vijayakar, director of energy consultancy Trifecta. Vijayakar said there also "seems to be a difficulty in reaching consensus on extending the production cuts".

Traders said that rising U.S. drilling activity and oil production were contributing to financial traders reducing their long positions in crude futures to the lowest level since early December.

Since mid-2016, U.S. oil production has risen by 700,000 barrels per day (bpd), or 8.3 percent, to 9.13 million bpd, government data shows .

U.S. bank Goldman Sachs (NYSE:GS) said that should the rig count stay at current levels and the impact of previously closed rigs returning to production was considered, then U.S. oil production would rise by 235,000 bpd between the fourth quarter of 2016 and the first half of 2017.

Because of soaring U.S. output and the cuts by OPEC, the discount of U.S. WTI crude prices to international Brent crude has grown to around $2.90 per barrel, heading for its widest close since late 2015, encouraging more sales of U.S. oil to Asia to replace cuts in Middle East production.

Despite the ongoing fuel supply overhang and rising U.S. shale output, Goldman Sachs said that global oil markets were slowly rebalancing, largely due to strong demand growth.

"While the shale production rebound has surprised to the upside, it will be offset in our view by the high compliance to the production cuts through 1H17 and most importantly, strong demand levels," the bank said.

"We believe that the rebalancing of the oil market is in fact making progress," it said, adding that an OPEC-led extension of the production cut was therefore not needed.

Oil bounces off November lows, but bloated US stockpiles pressure market - Sean Seshadri

Oil prices recovered on Thursday from losses chalked up the session before, but the market remained under pressure as bloated U.S. crude inventories and rising output dampen OPEC-led efforts to curb global production.

Brent crude futures, the international benchmark for oil, were at $50.99 per barrel at 0621 GMT, up 35 cents, or 0.7 percent, from their last close. That came after Brent briefly dipped below $50 a barrel on Wednesday for the first time since November.

U.S. West Texas Intermediate (WTI) crude futures were up 37 cents, or 0.8 percent, at $48.41 a barrel, after testing support at $47 overnight.

Analysts said Brent had found technical support around $50 a barrel and was being pushed up as traders took new long positions after crude hit multi-month lows overnight.

Despite the bounce, traders said the market remained under pressure, largely due to a big U.S. inventory and doubts that an effort led by the Organization of the Petroleum Exporting Countries (OPEC) to cut output was reining in a global fuel supply overhang.

Greg McKenna, chief market strategist at futures brokerage AxiTrader, said OPEC was "underwriting the investment plans and returns of their competition in U.S. shale oil."

McKenna said there was a risk of oil prices dropping further due to U.S. output and a lack of compliance by some producers who said they would cut production.

Oil prices could rise to $60 per barrel in the second quarter, assuming inventory draws and oil producer output cuts remain in place, Barclays (LON:BARC) said in a report on Thursday.

"However, this would likely be temporary, and we forecast prices in the mid-$50s per barrel in the second half 2017," the bank said.

The Energy Information Administration (EIA) said U.S. inventories climbed almost 5 million barrels to a record 533.1 million last week, far outpacing forecasts of a 2.8 million-barrel build.

The high inventories come as U.S. oil production has risen over 8 percent since mid-2016 to more than 9.13 million barrels per day (bpd) to levels comparable in late 2014, when the oil market slump started.

There were also signs of a bloated market in Asia, where China's gasoline imports slumped while its refiners sent huge volumes overseas as they refine more fuel than the domestic market can absorb.

China's gasoline exports in February hit the second highest on record, up 76.6 percent over a year earlier at 1.06 million tonnes, data from the Chinese customs showed on Thursday. Diesel exports last month surged 66.7 percent on year at 1.32 million tonnes.

China imported just 7,245 tonnes of gasoline in February, tumbling 94 percent from the same period last year. Diesel imports dropped 52 percent from a year ago to 50,000 tonnes.

Gold climbs to more than 2-week high as dollar sinks - Sean Seshadri

Gold prices rose to a more than two-week high during North American hours on Tuesday, as the U.S. dollar continued to head south in wake of the Federal Reserve's dovish guidance on the future pace of rate hikes.

Comex gold futures jumped to a session peak of $1,237.95 a troy ounce, the highest since March 2. It was last at $1,237.15 by 9:40AM ET (13:40GMT), up $3.50, or around 0.3%. It settled higher for the third session in a row on Monday.

Meanwhile, spot gold was up $3.40 at $1,237.70 per ounce.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down around 0.6% at 99.59 in New York morning trade, the weakest level since February 3.

The greenback has been on the retreat since the Fed raised interest rates on Wednesday last week, but stuck to its outlook for two more hikes this year, instead of three expected by the market.

Market players awaited comments from a number of Fed policymakers for more clues on the timing of the next U.S. rate hike.

Tuesday sees New York Fed President William Dudley, Kansas City Fed President Esther George and Cleveland Fed President Loretta Mester make public appearances. Fed Chair Janet Yellen speaks on Thursday.

The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.

A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.

Headlines from Washington will also be in focus, as traders await further details on President Donald Trump's promises of tax reform and infrastructure spending.

The House is expected to vote on a heath care bill Thursday, and if it passes that would be seen as a small step moving Congress closer to considering tax reform, though any legislation must also battle its way through the Senate.

Also on the Comex, silver futures for May delivery tacked on 15.2 cents, or about 0.9%, to $17.58 a troy ounce, the most since March 7.

Meanwhile, platinum added around 0.3% to $975.15, while palladium rose 0.9% to $788.85 an ounce.

Elsewhere in metals trading, copper futures dropped 2.9 cents, or 1.1%, to $2.638 a pound, following reports that a strike at a key Indonesian mine has ended, easing concern over a disruption to supply.

Gold drifts weaker in Asia as Fed views on rates weigh - Sean Seshadri

Gold prices fell in Asia on Friday with sentiment supported largely on political risk and mixed views about the pace of Federal Reserve rate hikes this year.

Gold for April delivery on the Comex division of the New York Mercantile Exchange inched down 0.13% to $1,225.45 a troy ounce. Elsewhere, silver futures fell 0.24% to $17.288 a troy ounce, while copper dipped 0.11% to $2.674 a pound.

Overnight, gold prices traded sharply higher on Thursday, amid a slump dollar, as investors mulled over the Federal Reserve’s more dovish than expected statement on the pace of rate hikes this year.

The Federal Reserve stuck a familiar tone in its statement on Wednesday, pointing out that interest rate increases “will be gradual” in 2017, and maintained its view of three rate hikes, with the remaining two rate hikes expected later this year.

Fed Chief Janet Yellen said in press conference Wednesday, the US central bank would continue to provide accommodative monetary policy to support the US economy but warned against a prolonged period of lower rates in order to avoid a situation which forces the fed to “raise rates rapidly”.

Meanwhile a mixed batch of economic data had a muted effect on the yellow-metal as it continued to trade near session highs.

Weekly initial jobless claims fell to 241,000. Housing starts rose to a seasonally adjusted annual rate of 1.288 million in February while the Philadelphia Fed Index topped forecasts at 32.8 for March. Both the Philadelphia Fed Index and the housing starts beat forecasts.

Crude prices move higher but upside seen limited - Sean Seshadri

U.S. oil prices moved higher on Friday, as a surprise drop in U.S. stockpiles continued to support, but gains were expected to remain limited as concerns over the effectiveness of OPEC’s output cuts persisted.

U.S. crude futures for April delivery were up 0.49% at $49.08 a barrel.

On the ICE Futures Exchange in London, the May Brent contract gained 0.56% to trade at $52.02 a barrel.

Crude prices rallied after the U.S. Energy Information Administration said in its weekly report on Wednesday that crude oil inventories declined by a surprising 237,000 barrels last week to 528.2 million barrels. It was the first drawdown in stockpiles since early January.

The commodity also benefited from a weaker dollar after the Federal Reserve’s policy statement on Wednesday was seen as less hawkish than expected by sticking to projections of three total rate hikes in 2017 and not four as some traders had hoped for.

However, traders were expected to remain cautious after a report earlier in the week showed that Saudi Arabia raised output back above 10 million barrels a day in February, sparking fresh concerns over a global supply glut.

Separately, Iraq said its March oil exports averaged 3.25 million barrels-per-day in the first 14 days of the month, slightly lower than February's 3.27 million bpd. However, the decline was not as much as expected, raising doubts over the country's compliance with the OPEC supply cut deal.

January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day to 32.5 million for the next six months, but so far the move has had little impact on inventory levels.

Kuwait is scheduled to host a ministerial meeting on March 26 comprising both OPEC and non-OPEC members to review compliance with the output agreement and to discuss whether cuts would be extended beyond June.