Commodity prices mostly retreated this week as traders sought safety in the midst of more bleak outlooks for the global economy.
Sentiment was downbeat after the Organisation for Economic Co-operation and Development (OECD) on Wednesday trimmed its world economic growth forecast for this year to 3.1 percent from 3.4 percent.
Adding to the pressure on demand for raw materials was news this week from the IMF that it has cut its growth forecast for China for this year to close to 7.75 percent, citing a sluggish global recovery which has hurt exports.
OIL: World oil prices dropped as traders reacted to more news of economic strains, while taking OPEC’s expected decision to maintain its output ceiling in their stride.
By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in July dropped to US$101.06 a barrel from US$102.27 a week earlier.
On the New York Mercantile Exchange, West Texas Intermediate (WTI) or light sweet crude for July slipped to US$92.67 a barrel from US$93.91 a week earlier.
PRECIOUS METALS: Prices increased across the board.
“Precious metal markets look well set to post a second week of gains after speculation that the [US] Fed will maintain bond purchases increased demand for gold and silver markets as an inflationary hedge, with a weaker greenback also helping dollar denominated asset,” said Nicky Dale-Lace, senior sales trader at CMC Markets.
By late Friday on the London Bullion Market, the price of gold rose to US$1,394.50 an ounce from US$1,390.25 a week earlier.
Silver climbed to US$22.57 an ounce from US$22.38.
On the London Platinum and Palladium Market, platinum inched higher to US$1,459 an ounce from US1,455.
Palladium grew to US$744 an ounce from US$729.
BASE METALS: Base or industrial metal prices were mixed, as traders tracked global economic uncertainty as well as strike action at a copper and gold mine in Indonesia.
“The downgrade to China’s growth forecast by the IMF ... seems to have set the weaker tone” for some metals, said William Adams, analyst at research group Fast Markets.
By Friday on the London Metal Exchange, copper for delivery in three months fell to US$7,270 a tonne from US$7,315.75 a week earlier.
Three-month aluminum was up to US$1,902 a tonne from US$1,854.50, and three-month lead climbed to US$2,183 a tonne from US$2,055.75.
Three-month tin retreated to US$20,900 a tonne from US$21,200, and three-month nickel decreased to US$14,670 a tonne from US$14,910.
Three-month zinc increased to US$1,912 a tonne from US$1,861.75